TSX declines as oil price plunges below US$36 a barrel

TORONTO -- The price of oil plunged below US$36 a barrel Friday, sending North American equity markets into sharp retreat and taking the commodity-sensitive Canadian dollar below 73 cents for the first time since mid-2004.

See Full Article

At midafternoon, the Toronto Stock Exchange's S&P/TSX index was down 157.65 points at 12,858.94.

Things were even worse in New York, where indexes have been negative all week with the exception of a modest advance on Thursday. The Dow Jones average of 30 stocks plunged 238.52 points to 17,336.23, while the broader S&P 500 fell 29.20 points to 2,023.03 and the Nasdaq shed 80.70 points to 4,964.47.

A major factor was another big drop in oil prices after the International Energy Agency said the global oversupply would continue until late next year and that demand would weaken. Oil prices have been falling for 1 1/2 years and are now at their lowest levels since early 2009 in the midst of the global financial crisis.

On commodity markets, the January contract for benchmark U.S. crude oil fell $1.04 to US$35.72 a barrel, while January natural gas lost three cents, sliding to US$1.98 per mmBtu. The capped energy sector was the biggest loser on the TSX, down 2.81 per cent.

Elsewhere in commodities, the February gold contract advanced $6.10 to US$1,078.10 an ounce, while battered copper prices rebounded four cents to US$2.12 a pound.

And the Canadian dollar, which has hit several new 11-year lows since it closed last week at 74.76 cents US, was down another 0.57 of a U.S. cent at 72.79 cents U.S.

In economic news, the Commerce Department reported that U.S. retail sales rose 0.2 per cent in November, an improvement compared to the August-October period and indicating that holiday shopping south of the border is off to a solid if unspectacular start.

In corporate news, Dow Chemical and DuPont confirmed a US$130-billion deal to merge. The new company is due to split into three parts, one focused on materials, one on agriculture and the third on specialty products. Dow Chemical (NYSE:DOW) fell $1.09 or almost two per cent to $53.82, while DuPont (NYSE:DD) plunged $3.87 or more than five per cent to US$70.68.

Meanwhile, traders were looking ahead to the weekend for a number of monthly reports, including retail sales and industrial production. A report on foreign direct investment in China is due on Wednesday.

But the main focus will be on next week's two-day policy meeting of the Federal Reserve Board, which wraps up Wednesday. The U.S. central bank is widely expected to announce the first increase in interest rates, commonly referred to as liftoff, since the Great Recession.



Advertisements

Latest Economic News

  • Car rental companies agree to pay $1.25M penalty for advertising impossible discounts

    Economic CBC News
    Two of Canada's largest car rental companies have agreed to pay $1.25 million in penalties for falsely advertising discount prices that are essentially impossible to obtain. Canada's Competition Bureau has reached what it calls a "consent agreement" with Hertz and Dollar Thrifty whereby both companies will pay penalties totalling $1.25 million and "ensure their advertising complies with the law and implement new procedures aimed at preventing advertising issues in the future. Source
  • Guide to 'fake news' wins $30,000 National Business Book Award

    Economic CTV News
    TORONTO -- A timely guide to distinguishing fact from fiction in the era of "fake news" was announced Monday as the winner of the $30,000 National Business Book Award. Neuroscientist Daniel J. Levitin said he was prompted to write "A Field Guide to Lies: Critical Thinking in the Information Age" (Allen Lane Canada) as a response to the "Balkanization of the news over the last 15 years. Source
  • Montreal couple hid winning $55M lottery ticket in daughter's toy box

    Economic CTV News
    MONTREAL -- A Montreal couple who won $55 million in a lottery jackpot hid the winning ticket in their daughter's toy box over the weekend. Nathalie Langlais and Gilles Rosnen picked up their winnings at Loto-Quebec headquarters in Montreal on Monday, three days after the Lotto Max draw. Source
  • Capital markets not a place for 2nd chances, OSC lawyers tell Drabinsky hearing

    Economic CBC News
    Lawyers for Ontario's securities regulator said today in their closing statements that Garth Drabinsky, who defrauded investors of an estimated $500 million, should not be allowed to participate in the capital markets. Pamela Foy, senior litigation counsel with the Ontario Securities Commission, says the capital markets are not the place for second chances and the commission cannot allow Drabinsky to be in a position where he could do more damage. Source
  • Luxury shoe brand Jimmy Choo goes up for sale

    Economic CTV News
    LONDON -- Shares in Jimmy Choo have leapt 11 per cent after its board put the luxury shoe brand up for sale. The gains bring the market value of the firm that began in east London to over 700 million pounds ($896 million). Source
  • Hertz and Thrifty to pay $1.25M fine following probe into their advertising

    Economic CTV News
    OTTAWA - Car rental companies Hertz Canada Ltd. and Dollar Thrifty Automotive Group Canada Inc. have agreed to pay a total of $1.25 million in penalties following an investigation into their advertising by the federal Competition Bureau. Source
  • U.S. Supreme Court rejects GM appeal to block ignition switch lawsuits

    Economic CBC News
    The United States Supreme Court has turned away an appeal from General Motors Co. seeking to block dozens of lawsuits over faulty ignition switches that could expose the company to billions of dollars in additional claims. Source
  • Qatar Airways sees 'manageable' decline in flights to U.S.

    Economic CTV News
    DUBAI, United Arab Emirates -- The CEO of one of the Middle East's largest carriers said Monday passenger numbers to the United States have dipped slightly over fears by some Muslim passengers that their visas may be rejected upon arrival, but expressed confidence in President Donald Trump as a "very good businessman. Source
  • Extra EI help to hard-hit regions tops $1 billion, surpassing budget estimates

    Economic CTV News
    OTTAWA -- The federal government says it has paid out more than $1 billion in extra employment insurance benefits to out-of-work Canadians in the hardest-hit economic regions of the country, blowing past what the Liberals estimated the program would cost. Source
  • Home Capital says founder Gerald Soloway to leave board, CFO to change role

    Economic CBC News
    Home Capital Group Inc. said Monday that two people named in an Ontario Securities Commission action against the company will be moving out of their roles. The embattled mortgage lender said chief financial officer Robert Morton will shift out of that role after the company files its first-quarter results. Source