Down 10% on the year, the Toronto Stock Exchange (TSX) has officially entered a correction.
The TSX composite index, Canada’s main stock exchange, fell 2.63% yesterday (June 13) to
finish trading at 19,742.56, putting it down 10% from an all-time high reached earlier this year.
All 11 subgroups of the index dropped yeterday, led by healthcare, technology and materials
stocks.
However, the TSX has fallen less than half the benchmark S&P 500 index in the U.S., which is
down 22% so far this year, putting it into a bear market, defined as a decline of 20% or more
from recent highs. The technology heavy Nasdaq index is down 32% year to date.
The selloff in stocks has intensified in the U.S. since late last week when inflation data showed
American consumer prices are at their highest level since 1981, raising investor fears of more
interest rate hikes from the U.S. Federal Reserve.
Wall Street’s three main indices, the Dow Jones Industrial Average, S&P 500, and Nasdaq,
each suffered steep declines yesterday, with the Dow ending the trading session down 2.79%
and the Nasdaq 4.68% lower.
In Canada, technology company Shopify (SHOP) continues to pull the TSX lower. Shopify’s
stock fell 9.37% yesterday, bringing its year-to-date decline to 77%.
The sharp declines yesterday were prompted by an accelerated selloff in cryptocurrencies, with
Bitcoin (BTC) falling below $24,000 U.S., an 18-month low. The entire cryptocurrency sector
plummeted following a decision by a leading cryptocurrency lender called “Celsius” to halt all
withdrawals citing “extreme market conditions.”
Markets in Europe and Asia also sold off aggressively yesterday on growing fears of a global
recession and as cryptocurrency prices collapse.
