Equity markets in Canada’s largest centre dropped for a fifth straight session on Thursday, nearing a three-month low, as sluggish U.S. economic data weighed on sentiment.
The S&P/TSX composite index plunged 226.97 points, or 1.5%, to close at 14,893.57
The Canadian dollar gave back 0.41 cents to 90.02 cents U.S.
Market volatility shot up and commodity prices remained choppy. A decline in the price of bullion sent gold-mining shares lower, offsetting a gain in Valeant Pharmaceuticals International.
Valeant said it had named the head of a top shareholder, ValueAct Capital, to its board of directors and vowed to continue with its hostile takeover attempt on Botox maker Allergan Inc.
Valeant shares jumped 3.2% to $141.66, helping keep the health-care sector in positive territory.
Financials dropped as Toronto-Dominion Bank shed 2.8% to $54.85, and Bank of Nova Scotia lost 1.7% to $68.91.
Shares of energy producers gave back strength. Canadian Natural Resources declined 2.1% to $43.21, and Suncor Energy fell 1.4% to $40.29.
As it was through most of the day, gold provided one of the few bright spots, with Argonaut Gold surging 3.8% to $4.07, and Continental Gold hiking 5% to $3.35.
Bank of Canada Governor Timothy Lane said Canadian monetary policy can diverge from that of its neighbour to the south, even as the U.S. Federal Reserve's exit from its extraordinary stimulus measures will likely raise market interest rates in Canada and weigh on the loonie.
Prime Minister Stephen Harper said on Wednesday he did not anticipate a housing crisis in Canada, where some analysts are fretting about high debt levels and a booming housing market.
ON BAYSTREET
The TSX Venture Exchange toppled 12.82 points to 912.13.
All but three of the 14 Toronto subgroups were lower on Thursday, as global base metals and information technology each slid 2.4%, while energy dropped 2.1%
The lone gainers were gold, up 1%, health-care, 0.4% to the good, while materials were just over breaking even.
ON WALLSTREET
U.S. stocks slumped Thursday, led by the tech sector, slapping the major benchmarks with their biggest one-day loss in almost two months.
The Dow Jones Industrials took a header, dropping 264.26 points, or 1.5%, to 16,945.80.
The S&P 500 dropped 32.31 points, or 1.6%, to 1,965.99. The NASDAQ plummeted 88.47 points, or 1.9%, to 4,466.75.
Both the S&P 500 and Dow suffered their biggest drops since July 31, when they fell 2% and 317 points, respectively. That’s after both achieved record closes last week. The NASDAQ’s dive was also its worst since July 31.
Strategists said there wasn’t one single explanation. Market observers, however, pointed to some possible drivers including Apple whose own shares were down more than 3%.
Apple dropped Thursday after pulling an update to iOS 8 on Wednesday. Users had reported major problems with the operating-system update.
Other worries centered on the Russia-Ukraine and Mideast conflicts as well as a weak U.S. durable-goods report.
Strategists also cited divergences between suffering small-cap stocks and the broader market and technical factors, including the S&P 500’s slicing through its 50-day moving average.
Orders for durable U.S. goods plunged by a record 18.2% in August after a record 22.5% gain in July, mainly because of volatile demand for airplanes.
Economists had expected orders to fall by 17.3%.
Meanwhile, the number of people who applied for unemployment benefits last week rose by 12,000 to 293,000, but initial claims continue to hover near an eight-year bottom amid a low rate of layoffs, new government data showed. Economists had expected claims to rise to 300,000.
Prices for 10-year U.S. Treasuries gained, lowering yields to 2.51% from Wednesday’s 2.57%. Treasury prices and yields move in opposite directions.
Oil prices retreated 34 cents to $92.46 U.S. a barrel.
Gold prices recovered $3.70 to $1,222.40 U.S. an ounce.
