Toronto stock market ends eight-day winning streak
Linda Nguyen, The Canadian Press
Published Tuesday, March 8, 2016 1:11AM EST
Last Updated Tuesday, March 8, 2016 7:25PM EST
TORONTO -- North American stock markets tumbled at the close Tuesday amid lower energy and metal prices and fresh concerns over the growth of China's economy.
Toronto's S&P/TSX composite index snapped an eight-day winning streak by ending the day 72.55 points lower at 13,311.05, weighed down by metals and mining, energy and gold stocks.
Metals stocks were the biggest decliner, falling by 7.32 per cent, with shares in miner First Quantum being biggest loser. Its stock was down 16 per cent, or $1.17, at $6.12 per share.
Overnight, China reported that its exports plunged 25 per cent last month from a year earlier. The world's second biggest economy blamed the weakness on falling global demand and the shutdown during the Lunar New Year holiday for the lower sales. Analysts were expecting poor trade data because of the holiday, but the figure is a bigger miss than they had anticipated.
The data pulled down copper prices, as the May contract declined six cents to US$2.22 a pound.
The Canadian dollar lost more than two-thirds of a cent, down 0.78 at 74.54 cents US.
In New York, the Dow Jones industrial average lost 109.85 points at 16,964.10, while the broader S&P 500 index dropped 22.50 points to 1,979.26. The Nasdaq composite gave up 59.43 points at 4,648.82.
John Wilson, chief executive at Sprott Asset Management, said the declines do not come as a surprise because markets have enjoyed a good run in recent weeks and were inevitably going to pull back sometime.
"The real question is that what kind of news do we get from here that reaffirms this rally or puts it into question?" he asked.
"That's what the next month or so is going to be about. People trying to look for bread crumbs that say they're on the right trail for buying these stocks or bread crumbs that say there was no basis for this rally and the situation is still difficult and you want to take your profits and run."
The Bank of Canada is expected to deliver its latest interest rate decision on Wednesday. It's widely anticipated that the central bank will hold its overnight rate at 0.5 per cent, amid positive yet still tepid signs of economic growth.
All eyes will also be on the latest policy meeting of the European Central Bank. Investors are expecting ECB President Mario Draghi to confirm that inflation across the 19-country eurozone has fallen back below zero, and that there will be further stimulus from the central bank.
The losses on Bay and Wall Streets came as commodities pulled back.
The April crude oil contract fell US$1.40 to US$36.50 a barrel, while the April gold contract dipped $1.10 at US$1,262.90 a troy ounce. The price of April natural gas gained two cents at US$1.71 per mmBtu.