Loonie slips, markets extend decline with another day of losses

TORONTO -- Hopes for a reprieve on North American stock markets were dashed Friday in another dismal session that capped off a turbulent start to the year.

See Full Article

Toronto's S&P/TSX composite index was down 2.76 points at 12,445.45, a relatively flat close that marked the eighth consecutive day of declines that left it more than 20 per cent below its all-time high set in September 2014. A drop of that magnitude is generally considered to signal a bear market.

The TSX has lost 4.3 per cent of its value since the start of the week and the beginning of 2016 -- with a precipitous drop in key commodities like oil and gold making the biggest dent.

Wall Street declines were even steeper on Friday as U.S. markets wrapped up their worst week since 2011.

The Dow Jones ended down 167.65 points at 16,346.45 while the broader S&P 500 slipped 21.06 points to 1,922.03 and the Nasdaq dropped 45.80 points to 4,643.63.

A lot has happened since traders ushered in the new year with hopes of moving past 2015, which was accented by falling oil prices and a sour outlook for Canada's economy.

But optimism quickly evaporated when China's new circuit breaker kicked in early Monday after the Shanghai index plunged seven per cent. While the mechanism was intended to avert further falls, it also appeared to send global stock markets into a panic as traders shifted their positions in anticipation of other surprises.

Matters only worsened by Thursday when a surprise move by China's central bank to adjust its currency rate did little to calm fears, and the market dropped again, causing the local regulator to suspend the circuit breaker.

China's main indexes finally moved higher on Friday, though it didn't seem to be enough to resurrect positivity in North America.

"Right now in the marketplace there's a lot of 'Sell first, ask questions later,"' said Kevin Headland, director of capital markets and strategy at Manulife Asset Management.

The Canadian dollar was down 0.26 of a cent at 70.68 cents U.S. as it continued to plumb depths not seen since July 2003.

In the latest sign of a strengthening American economy, the U.S. Labor Department reported Friday that employers added 292,000 jobs in December, far more than analysts forecast. Canada added about 22,800 jobs in December, though that was fuelled by part-time work.

On the TSX, the energy sector inched up 0.2 per cent, even as the February crude contract lost 11 cents to US$33.16 a barrel -- settling down more than 10 per cent on the week.

"We're trying to find a base in oil prices -- where that base is, I don't think anyone really knows," said Headland.

"When you start seeing pressure at corporations, in terms of more defaults and more M&A (mergers and acquisitions) activity ... when you see companies trying to hold on for dear life, and that's when you start to see the bottoming of oil prices in North America."

The natural gas contract for February rose nine cents to US$2.47 per mmBtu.

Gold stocks dropped 2.3 per cent and February gold fell by $9.90 to US$1,097.90 an ounce.



Advertisements

Latest Economic News

  • Montreal's Oreo cookie plant prepares to shut its doors

    Economic CTV News
    MONTREAL -- There was a time when the whole neighbourhood surrounding an east-end Montreal bakery would smell like baking Oreos. But that era comes to an end this month when snack-maker Mondelez International closes its Montreal factory for good. Source
  • Oilsands tech touted for pipeline capacity boost still years from deployment

    Economic CBC News
    Two years after a blue-ribbon panel called on the Alberta government to encourage partial upgrading of bitumen from the oilsands to enhance value and free up more pipeline room for exports, the idea remains years away from commercialization. Source
  • Nunavut lagging behind in ramp-up to marijuana legislation

    Economic CTV News
    IQALUIT, Nunavut -- With marijuana legalization only months away, members of Nunavut's new government are finally discussing how the territory will handle the change. "We do feel behind in our preparation," said Dan Carlson, Nunavut's deputy minister of finance. Source
  • Bitumen upgrade still years away for Alberta oilsands

    Economic CTV News
    CALGARY -- Two years after a blue-ribbon panel called on the Alberta government to encourage partial upgrading of bitumen from the oilsands to enhance value and free up more pipeline room for exports, the idea remains years away from commercialization. Source
  • Opposition grows to Bell, Rogers-backed plan to block piracy websites

    Economic CBC News
    Opposition is mounting to a media coalition's plan to block Canadians from accessing piracy websites. Many people fear that the plan — backed by big players such as Bell, Rogers, and CBC — could lead to rampant internet censorship. Source
  • Landline phone scam and luxury car purchases: CBC's Marketplace consumer cheat sheet

    Economic CBC News
    Miss something this week? Don't panic. CBC's Marketplace rounds up the consumer and health news you need. Want this in your inbox? Get the Marketplace newsletter every Friday. Watch out for this phone scam A new phone scam targets landlines. Source
  • Flying high: 100,000 pot plants flown from Ontario to B.C.

    Economic CTV News
    Under tight security, 100,000 marijuana plants arrived at Vancouver International Airport Saturday to be cultivated in a network of greenhouses in Langley, B.C. that’s being touted as the largest licensed cannabis production facility in the world. Source
  • Are female-led companies the answer to sexual misconduct?

    Economic CTV News
    NEW YORK -- The Weinstein Co. thought it had found a path to survival. A group of investors led by a respected businesswoman offered to acquire the company, rebrand it and install a female-led board of directors. Source
  • B.C. to appeal NEB ruling on Trans Mountain bylaw

    Economic CTV News
    VICTORIA -- British Columbia's government is appealing a decision that allows Kinder Morgan Canada to bypass local regulations in constructing its Trans Mountain pipeline expansion. The National Energy Board ruled in December that the company is not required to comply with two sections of the City of Burnaby's bylaws, which Kinder Morgan had said were hindering its ability to go ahead with the federally approved project. Source
  • PepsiCo shuts down Alberta Spitz sunflower seed factory

    Economic CBC News
    Thirty years after Spitz sunflower seeds first sprouted in Alberta, the last factory in the province is set to shut down. PepsiCo is closing the Bow Island processing plant in July, and laying off 53 workers from the small community of just 2,000 residents in the process. Source