B.C. tenants evicted for landlord's use after refusing large rent increase to take over neighbouring suite
Ashley Dickey and her mother rented part of the same Coquitlam duplex in three different decades under three different landlords.
North American markets saw broad-based declines Wednesday, raising the spectre of more volatility ahead as investors continue to worry about inflation and the possibility of recession.
The S&P/TSX composite index was down 88.53 points at 20,181.44.
In New York, the Dow Jones industrial average was down 171.69 points at 33,980.32. The S&P 500 index was down 31.16 points at 4,274.04, while the Nasdaq composite was down 164.43 points at 12,938.12.
Financial markets have been on a significant upward trend in recent weeks, bolstered by better-than-expected second-quarter earnings reports as well as July inflation numbers from Canada and the U.S., both of which showed a slight cooling in the year-over-year inflation rate.
In the last four weeks, the S&P/TSX composite has recovered much of the losses that began in June, when investor concerns about skyrocketing inflation and how far central bankers might be willing to go to tame it sparked a major sell-off.
While some analysts have suggested a continuation of the recent rally is possible, Wednesday's slide appears to be an indication of volatility ahead, said Greg Taylor, chief investment officer at Purpose Investments.
"The markets have had a really big bounce in the last four to six weeks. So much so, that we're getting some markets that look a little overbought in the short-term," Taylor said.
"And I think now we've got a situation where investors are starting to say, `OK, we've gotten all this bounceback. Is everything really as good as the markets are starting to price in?' "
On Tuesday, Statistics Canada released new data showing the year-over-year inflation rate slowed to 7.6 per cent in July, down from the nearly 40-year high of 8.1 per cent in June.
While that news came as a relief to investors, it's not clear that a slight downtick in the cost-of-living will be enough to dissuade the Bank of Canada from another significant interest rate in September.
Similarly, Taylor said there's been nothing from the U.S. Federal Reserve to indicate that the fight against inflation is over, and the current 8.5 per cent inflation rate south of the border remains far from the Fed's own target of three per cent.
"So the markets may have gotten a little ahead of themselves," Taylor said. "I think more than anything investors are looking at how much markets have rebounded in the last few weeks, and wondering if that was too much, too fast."
On the commodities front, crude oil gained Wednesday after losing ground three days in a row on weak economic data out of China and speculation about what an Iran nuclear deal could mean for global inventories.
Taylor said it's not a surprise to see the price of oil creeping higher again, because the fundamentals for energy remain strong. The September crude contract was up $1.58 at US$88.11 per barrel on Wednesday.
"The thing with oil is, there's just no new supply coming onto the market," he said. "It (the price of crude) is down from where it was but it's still a good level for these (Canadian energy) companies."
The price of natural gas jumped to a 14-year high this week on the Henry Hub U.S. benchmark, in large part due to the ongoing European energy crisis. While it declined slightly Wednesday, demand for the fuel remains exceptionally strong. The September natural gas contract was down eight-and-a-half cents at US$9.24 per mmBTU.
"The fear of no gas supplies in Europe for the winter is really starting to spook people, and that's keeping natural gas going," Taylor said.
The December gold contract was down US$13 at US$1,776.70 an ounce and the September copper contract was down four cents at US$3.58 a pound.
The Canadian dollar traded for 77.45 cents US compared with 77.72 cents US on Tuesday.
Taylor said while August is generally a slow trading month, September and October are traditionally among the most volatile months for investors.
Another red flag that could signal potential choppiness ahead, Taylor added, is the recent return of the so-called "meme stock" -- a name given to the inexplicable rise in a specific company's share value, such as was seen last year at the heart of the GameStop trading frenzy.
Currently, the "meme stock" is Bed Bath & Beyond, which has seen its share price nearly quintuple in less than two weeks on huge trading volumes, in spite of the retailer's plummeting sales.
"To me, that's another concerning sign. When you see people gambling on stocks like this, that's something you see closer to the end of a bounce than the beginning," Taylor said.
"Everything's lining up, so I would say to investors if you've had some gains, it's probably time to start looking to take some profits off the table and get set up for some volatility that may emerge in the next few weeks."
This report by The Canadian Press was first published Aug. 17, 2022.
-- With files from The Associated Press
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