Markets start 2016 with sharp drop; TSX joins trend that began in China

TORONTO -- Stock markets around the world got off to a bad start in the first day of trading for 2016, sparked by a sharp drop in China that triggered a new "circuit breaker" mechanism that closed trading early to limit losses.

See Full Article

The Toronto Stock Exchange's S&P/TSX composite index was down 198.15 points or 1.52 per cent after an hour of trading, taking the index to 12,811.80 at midmorning.

In New York, the Dow Jones average was down 355.02 points or 2.04 per cent at 17,070.01, the broader S&P 500 index declined 40.36 points or nearly two per cent per cent to 2,003.58 and the Nasdaq lost 128.386 points or 2.80 per cent to 4,464.88.

The plunge began on the Shanghai index, which dived 6.9 per cent to 3,296.66 before the market was closed early to avert steeper falls. It was the first day of operation for a the new "circuit breaker" mechanism.

The Shanghai market's decline followed weak reports on its manufacturing sector, which appeared to contract in December for the 10th straight month, according to a private-sector survey of purchasing managers.

The Caixin/Markit index fell to 48.2 in December from 48.6 the previous month. Numbers below 50 indicate contraction.

The Canadian dollar traded at 71.99 cents U.S., down 0.26 of a cent from Thursday's close before the New Year holiday.

The February crude contract was up 78 cents at US$37.82 per barrel and the January contract for natural gas was down two cents at US$2.32.

The price of oil was partially helped by fresh political tensions in the Middle East. Saudi Arabia's execution of a Shiite cleric, along with 46 others on Saturday, sparked official outrage and protest in Iran and several other countries.

The February gold contract was up $18.40 to US$1,078.60 an ounce. Gold is often seen as a safe haven in times of political or economic uncertainty.



Advertisements

Latest Economic News

  • B.C. government introduces new speculation tax and raises foreign buyers tax

    Economic CBC News
    The B.C. government delivered on a wide variety of promises from its election platform and throne speech in its first budget, forecasting a $219 million surplus for the upcoming fiscal year on the strength of a strong economy. Source
  • Canadian bank earnings forecast bright but housing, NAFTA cloud outlook

    Economic CBC News
    The forecast for Canada's biggest banks is bright thanks to U.S. tax reform and higher interest rates, but as they report first-quarter results this week, domestic mortgage demand and the North American Free Trade Agreement could cloud the long-term outlook, analysts say. Source
  • Competition Bureau reaches settlement with Leon's and the Brick

    Economic CTV News
    OTTAWA - The Competition Bureau says it has reached an agreement with Leon's Furniture Ltd. and the Brick Ltd. regarding allegations of deceptive marketing practices. As part of the settlement, Leon's and the Brick have agreed to each donate $750,000 worth of home furnishings over two years to charities to be approved by the regulator. Source
  • Competition Bureau settles with Leon's, The Brick over marketing practices

    Economic CBC News
    The Competition Bureau says it has reached an agreement with Leon's Furniture Ltd. and the Brick Ltd. regarding allegations of deceptive marketing practices. As part of the settlement, Leon's and The Brick have agreed to each donate $750,000 worth of home furnishings over two years to charities to be approved by the regulator. Source
  • Pipeline backlogs to cost Canadian economy $10.7B this year: Scotiabank

    Economic CTV News
    CALGARY -- Delayed oil pipeline construction is causing a steep discount for Canadian crude prices that is costing the economy roughly $15.6 billion a year or about 0.75 per cent of GDP, according to Scotiabank. Source
  • Pipeline backlogs could cost Canadian economy $15.6B a year: Scotiabank

    Economic CTV News
    CALGARY -- Delayed oil pipeline construction is causing a steep discount for Canadian crude prices that is costing the economy roughly $15.6 billion a year, according to Scotiabank. "Pipeline approval delays have imposed clear, demonstrable and substantial economic costs on the Canadian economy," said bank chief economist Jean-Francois Perrault in a report Tuesday. Source
  • Don't fall for the staging: Real estate expert on how to avoid rookie buyer mistakes

    Economic CTV News
    Being a first-time home buyer without guidance from qualified professionals is like using the internet to diagnose a serious illness -- it’s not going to end well. That’s the advice Toronto real estate agent and industry expert Karyn Filiatrault gives to millennials looking to enter the housing market. Source
  • Trump government expected to defend tariffs on Canadian solar modules in court

    Economic CBC News
    President Donald Trump's decision to hit imports of Canadian solar energy modules with staggering tariffs, starting this month, has sparked another court battle over the extent of his powers to push through his America First agenda. Source
  • Trump administration expected to defend tariffs on Canadian solar modules in U.S. trade court

    Economic CTV News
    TORONTO -- U.S. President Donald Trump's decision to hit imports of Canadian solar energy modules with staggering tariffs, starting this month, has sparked another court battle over the extent of his powers to push through his America First agenda. Source
  • Canadian wholesale sales fall for first time in three months

    Economic CBC News
    Canadian wholesale sales fell surprisingly for the first time in three months in December as sales in five of the seven sectors tracked marked declines. Wholesale sales were down 0.5 per cent to $63 billion in the month - well below economists' forecast of a 0.4 per cent increase. Source