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

  • Expect Fed to gradually hike rates over next 3 years: Yellen

    Economic CTV News
    WASHINGTON -- Federal Reserve Chair Janet Yellen says she expects the Fed to raise its benchmark interest rate several times a year through 2019, as it moves closer toward to its economic goals of maximum employment and stable inflation. Source
  • U.S. Labor Department sues JPMorgan over sexual discrimination

    Economic CTV News
    NEW YORK -- The U.S. Department of Labor is suing JPMorgan Chase & Co. for discriminating against female workers. The federal agency said Wednesday that its review found that at least 93 female workers in an investment-bank division earned less than comparable men in the same jobs since at least May 2012. Source
  • Air Transat to test taxiing system that could cut emissions

    Economic CBC News
    Air Transat is planning to test and deploy a new system next year that would allow an aircraft to taxi from the runway to the gate without having to use a plane's engine, thereby cutting operating costs and greenhouse gas emissions. Source
  • Loonie down more than a cent after Poloz leaves door open to rate cut

    Economic CBC News
    The Canadian dollar was dragged down more than a full U.S. cent on Wednesday, following comments from the Bank of Canada that an interest rate cut "remains on the table" if conditions warrant. The loonie lost 1.16 U.S. Source
  • Bell Canada raising prices on home internet, TV in February

    Economic CBC News
    Bell Canada is increasing monthly prices for a number of its residential communications services, including home TV and internet packages, beginning in February. The increases will primarily affect customers in Ontario and Quebec. According to the Bell Canada website, the price increases are as follows: Source
  • Canadian Pacific Railway says Hunter Harrison stepping down immediately

    Economic CTV News
    CALGARY -- Canadian Pacific Railway Ltd. (TSX:CP) says that Hunter Harrison will step down as CEO immediately instead of leaving in July as announced last summer. The company said after markets closed that current president and chief operating officer Keith Creel will become CEO effective Jan. Source
  • U.S. sues Oracle, says it pays white men more than others

    Economic CTV News
    NEW YORK -- The Labor Department is suing Oracle, claiming that the technology giant pays white male workers more than their non-white and female counterparts with the same job titles. The lawsuit also says that the company has a systemic practice of favouring Asian workers in its recruiting and hiring practices for product development and other technical roles, which results in hiring discrimination against non-Asian applicants. Source
  • American Airlines to sell restricted 'basic economy' ticket

    Economic CTV News
    DALLAS -- The evolution of a caste system in the economy cabin of jetliners is deepening, with passengers divided and treated differently based on how much they are willing to pay the airline. American Airlines announced Wednesday that passengers will be able to buy "basic economy" tickets starting next month that will be similar to bare-bones fares already offered by Delta Air Lines and soon to be matched by United Airlines. Source
  • Credit Suisse to pay US$5.3B over mortgage-backed securities

    Economic CTV News
    NEW YORK -- Credit Suisse has agreed to pay US$5.3 billion to settle claims that it misled investors about the quality of mortgage-backed securities that it sold in the lead-up to the 2008 financial crisis. Source
  • U.S. Federal Reserve sees growth pickup at end of last year

    Economic CTV News
    WASHINGTON -- The U.S. economy grew a bit faster at the end of last year, spurred by healthier sales for manufacturers and steady hiring that is slowly pushing up wages. The Federal Reserve said Wednesday that its survey of economic conditions around the country found that growth was modest or moderate in 10 of its 12 districts. Source