Global markets sink led by Shanghai market plunge

TOKYO - Global stock markets sank Tuesday, led by a plunge in the Shanghai index, after a renewed slump in the price of oil kept investors on edge about the world economy.

See Full Article

KEEPING SCORE: France's CAC 40 fell 1.7 per cent in early trading to 4,239.19 and Germany's DAX lost 1.4 per cent to 9,598.50. Britain's FTSE 100 slipped 1.4 per cent to 5,793.98. U.S. shares were set to drift lower, with Dow futures slipping 0.8 per cent to 15,692. S&P 500 futures fell 0.7 per cent to 1,857.70.

ASIA'S DAY: The Shanghai Composite dropped 6.4 per cent to finish at 2,749.78, the lowest since December 2014, when the index was beginning a rally that peaked last June. Japan's Nikkei 225 lost 2.4 per cent to 16,708.90. South Korea's Kospi slipped 1.2 per cent to 1,871.69. Hong Kong's Hang Seng was down 2.6 per cent at 18,831.87. Other regional markets were also mostly down.

OIL CONCERNS: Plunging oil prices have been hitting profits at energy companies and getting investors worried the fall in energy costs could add to deflationary pressures in major economies. Slower growth in China is one reason for oil prices to fall. The slide also reflects oversupply including new sources of production such as shale oil in the U.S. Oversupply is set to be compounded by the lifting of sanctions on Iran, allowing it resume oil exports.

CHINA FACTOR: In China, investors were in near-panic in the absence of a shift in government policies and economic fundamentals, according to Chen Yong, market strategist for Lianxun Securities. The approach of the Lunar New Year didn't help, as players become reluctant to invest for fear of any unexpected sharp falls in overseas markets.

THE QUOTE: "It's just another in a long series of slumps that we have seen in this market, and it's not the last we will see either because the market is still overpriced. And too many people want to get their money out. It's been a bubble since it began last summer," said Michael Every, who heads Financial Markets Research, Asia-Pacific, at Rabobank. He expects another 10 per cent drop or more in Shanghai shares before things settle down.

ENERGY: Benchmark U.S. crude was down 85 cents at $29.49 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.85, or 5.7 per cent, to $30.34 a barrel in New York on Monday. Brent crude, a benchmark for international oils, lost $1.01 to $29.49 a barrel in London. It fell $1.68, or 5.2 per cent, to $30.50 a barrel the previous day.

CURRENCIES: The dollar fell to 117.74 yen from 118.23 yen in the previous trading session. The euro inched up to $1.0870 from $1.0850.



Advertisements

Latest Economic News

  • Italian PM 'guarantees' savers' accounts in 2 troubled banks

    Economic CTV News
    ROME -- Italy's premier says holders of accounts in two troubled Italian banks will have their savings guaranteed despite insolvency proceedings. Premier Paolo Gentiloni was referring to Veneto Banca and Banca Popolare di Vicenza, each struggling with unpaid loans. Source
  • Forget the poop scooping: who will pay the bills for your pet?

    Economic CBC News
    The scene is so common, it's cliché: Your adorable child looks longingly into your eyes, begging for a pet. You somehow navigate the emotionally fraught minefield of cat vs. dog. Then it's time to talk chores. Source
  • 'Eventually, many will run out': How an LCBO strike could impact restaurants and bars

    Economic CBC News
    A long drawn-out strike by liquor store workers could have a significant impact on Ontario's restaurants, wine importers, bars and consumers — but it may offer a boon to some local wineries. "Eventually, many [restaurants and bars] will run out, if not all, if it goes into a month, two months," said Tony Elenis, president and CEO of the Ontario Restaurant Hotel and Motel Association. Source
  • Ivanka Trump ordered to testify in dispute with shoe company

    Economic CTV News
    NEW YORK -- Ivanka Trump must testify in a dispute with an Italian shoemaker over one of her company's shoe designs, a judge said Friday. U.S. District Judge Katherine Forrest rejected a request by the senior White House aide's lawyers that she be blocked from submitting to a deposition in the trademark infringement lawsuit brought by Aquazzura Italia SRL against her and her company IT Collection LLC. Source
  • Cooling measures already affecting hot Toronto housing market: survey

    Economic CTV News
    The recent intervention by the Ontario government to cool the Toronto-area’s hot housing market is already having an impact on sellers and buyers plans for the year, according to a new poll. At the end of April, Ont. Source
  • Why is the American teen summer job disappearing? [Video]

    Economic Toronto Sun
    WASHINGTON — It was at Oregon’s Timberline Lodge, later known as a setting in the horror movie “The Shining,” where Patrick Doyle earned his first real paycheque. He was a busboy. The job didn’t pay much. But Doyle quickly learned lessons that served him for years as he rose to become the CEO of Domino’s, the pizza delivery giant: Source
  • Waiting for a Canadian housing crash? Warren Buffet bets against it buying 38% stake in Home Capital Group Inc.

    Economic Toronto Sun
    Warren Buffett's deal to back Home Capital Group Inc. does more than support a struggling mortgage lender -- it's a vote of confidence for a housing market that everyone from investors to global ratings companies say is a bubble ready to burst. Source
  • CIBC looks to generate quarter of earnings from U.S.

    Economic CBC News
    CIBC closed its acquisition of Chicago-based PrivateBancorp on Friday, securing its foothold in the U.S. where CEO Victor Dodig said the bank hopes to one day generate a quarter of its earnings. The Canadian bank now earns roughly five per cent of its profits in the U.S. Source
  • CIBC closes acquisition of U.S.-based PrivateBancorp

    Economic CTV News
    TORONTO -- CIBC closed its acquisition of Chicago-based PrivateBancorp on Friday, securing its foothold in the U.S. where CEO Victor Dodig said the bank hopes to one day generate a quarter of its earnings. The Canadian bank (TSX:CM) now earns roughly five per cent of its profits in the U.S. Source
  • Consumer demand for debt as high as it has ever been, Equifax says

    Economic CBC News
    Canadians' appetite for debt is as insatiable as ever, a new report from credit monitoring firm Equifax says. Equifax calculates that Canadian consumers owed $1.729 trillion at the end of the first quarter, an increase of 6.9 per cent in a year. Source