CANADA STOCKS-Tech selloff, Fed hawks push TSX toward third straight weekly loss

By Avinash P and Pranav Kashyap

Nov 14(Reuters) -

Canada's main stock index dropped on Friday, dragged down by hawkish signals from U.S. Federal Reserve officials, a sweeping tech selloff and lower commodity prices.

At 09:48 a.m. ET, Toronto's S&P/TSX composite index fell 0.8%, after dropping as much as 1.4% to its lowest level in a week, compounding Thursday's 1.9% decline.

Tech stocks once again led a broad selloff, setting the benchmark index on its way to a third straight weekly loss - the longest such streak in over a year.

Canadian stocks had advanced this week as hopes for a Fed rate cut next month lifted risk appetite. But fresh remarks from Fed officials have slashed the odds of a December cut to 49%.

"Market sentiment is swinging wildly this week, reflecting a clash of narratives that has left investors struggling to find direction," said Daniela Hathorn, senior market analyst at Capital.com.

"On one hand, optimism over the end of the U.S. government shutdown has sparked relief rallies, on the other, renewed concerns about the sustainability of the AI boom have quickly tempered the mood."

The sub index of gold fell 3.8%, as prices of the yellow metal fell over 3%, and the mining index declined 2.8%.

Canadian factory sales grew by 3.3% and wholesale trade grew by 0.6% in September from August, official data showed.

In corporate news, Globe and Mail reported that Swedish defense company Saab is in talks with the Canadian government and Bombardier to build its Gripen fighter jet under license in Canada. The business jet maker's shares were up 2.8%.

Canada's ECN Capital (ECNCF) said a Warburg Pincus-led investor group will buy the financial services firm in a C$1.9 billion ($1.35 billion) deal, signaling growing private-equity interest in the sector following policy easing. Shares were down 1.6%. (Reporting by Avinash P and Pranav Kashyap in Bengaluru; Editing by Sahal Muhammed)