Indian envoy warns of 'big red line,' days after charges laid in Nijjar case
India's envoy to Canada insists relations between the two countries are positive overall, despite what he describes as 'a lot of noise.'
Allan Small said the first half of 2022 has proven to be the worst run of his 25-year investment career.
Canada's main stock index concluded its weakest quarter since before the pandemic while U.S. markets endured their worst six-months runs in decades on fears that rising interest rates will throw the economy into recession.
“As we hit the mid-point of the year, when you look back I think the first part of the year will be known for just a bloodbath in the markets,” the senior investment adviser at IA Private Wealth said in an interview.
The S&P/TSX composite index closed down 217.28 points to 18,861.36 to end the quarter off nearly 14 per cent for the biggest decrease since December 2019. The TSX is closed Friday for Canada Day while U.S. markets will be closed Monday for Independence Day.
In New York, the Dow Jones industrial average was down 253.88 points at 30,775.43. The S&P 500 index was down 33.45 points at 3,785.38, while the Nasdaq composite was down 149.15 points at 11,028.74.
The TSX is down 11 per cent so far this year, while the Dow is down 15 per cent, the S&P 500 is off 20.6 per cent for the worst six months in 50 years and Nasdaq fell a record 29.5 per cent.
“I don't remember a year that started off the six months this poorly,” said Small.
Soaring inflation has been stoked by Russia's invasion of Ukraine while supply chain bottlenecks have been accentuated by China's COVID-19 lockdowns.
While markets endured steep declines in the past due to COVID-19 and the financial crisis, they were always followed by people buying the dip. This time, many investors remain on the sidelines after getting hammered and unsure about when markets will bottom out.
Economic data out of the U.S. on Thursday said core inflation numbers, the Fed's preferred inflation measure, rose 4.7 per cent in May. That's 0.2 of a per cent lower than April but still around 40-year highs.
In Canada, economic growth slowed in April to 0.3 per cent, while a preliminary estimate for May suggests it likely contracted 0.2 per cent. The U.S. previously said its economy slipped 1.6 per cent in the first quarter.
A negative number in the second quarter will mean the U.S. economy is technically in recession. But Small said many people think the economy is already there and that Canada is either in recession or about to go into one.
Small said he wouldn't be surprised to see markets rise during a recession in anticipation of things getting better, with inflation moving down after peaking.
Real estate and utilities were the lone sectors in positive territory Thursday in a broad-based slump with six of nine sectors falling by more than one per cent.
Health care led the declines, losing 4.1 per cent with Canopy Growth Corp. plunging 18.5 per cent after the pot producer announced a convertible notes exchange.
Materials lost 3.6 per cent on a drop in metals prices, particularly copper.
The August gold contract was down US$10.20 at US$1,807.30 an ounce and the September copper contract was down 7.1 cents at US$3.71 a pound.
“Whenever you have fear of a recession, those types of metals which are used to build homes and build things, the fear is that you're not going to need to use as much of these building materials,” Small said.
Energy lost 1.7 per cent on lower prices with crude oil dropping as Advantage Oil & Gas Ltd. shares were down six per cent.
The August crude contract was down US$4.02 at US$105.76 per barrel and the August natural gas contract was down US$1.07 at US$5.42 per mmBTU.
The Canadian dollar traded for 77.60 cents US compared with 77.65 cents US on Wednesday.
Shopify Inc. decreased 5.6 per cent to push technology lower while Laurentian Bank fell 2.5 per cent to lead a drop in the heavyweight financial sector.
Small is hoping for a better second half of the year after central banks conclude their aggressive interest rate hikes to tame soaring inflation.
“I don't know if we're going to make back enough to get us in the green for the year, but I'm hopeful that we'll see a positive second half and we'll make back some of the losses.”
This report by The Canadian Press was first published June 30, 2022.
India's envoy to Canada insists relations between the two countries are positive overall, despite what he describes as 'a lot of noise.'
With Donald Trump sitting just feet away, Stormy Daniels testified Tuesday at the former president's hush money trial about a sexual encounter the porn actor says they had in 2006 that resulted in her being paid to keep silent during the presidential race 10 years later.
The U.S. paused a shipment of bombs to Israel last week over concerns that Israel was approaching a decision on launching a full-scale assault on the southern Gaza city of Rafah against the wishes of the U.S.
Footage from dozens of security cameras in the area of Drake’s Bridle Path mansion could be the key to identifying the suspect responsible for shooting and seriously injuring a security guard outside the rapper’s sprawling home early Tuesday morning, a former Toronto homicide detective says.
A chicken farmer near Mattawa made an 'eggstraordinary' find Friday morning when she discovered one of her hens laid an egg close to three times the size of an average large chicken egg.
Susan Buckner, best known for playing peppy Rydell High School cheerleader Patty Simcox in the 1978 classic movie musical 'Grease,' has died. She was 72.
Accused killer Jeremy Skibicki could have a challenging time convincing a judge that he is not criminally responsible for the deaths of four Indigenous women, a legal analyst says.
A Calgary bylaw requiring businesses to charge a minimum bag fee and only provide single-use items when requested has officially been tossed.
Two Nova Scotia men are dead after a boat they were travelling in sank in the Annapolis River in Granville Centre, N.S., on Monday.
An Ontario man says he paid more than $7,700 for a luxury villa he found on a popular travel website -- but the listing was fake.
Whether passionate about Poirot or hungry for Holmes, Winnipeg mystery obsessives have had a local haunt for over 30 years in which to search out their latest page-turners.
Eighty-two-year-old Susan Neufeldt and 90-year-old Ulrich Richter are no spring chickens, but their love blossomed over the weekend with their wedding at Pine View Manor just outside of Rosthern.
Alberta Ballet's double-bill production of 'Der Wolf' and 'The Rite of Spring' marks not only its final show of the season, but the last production for twin sisters Alexandra and Jennifer Gibson.
A mother goose and her goslings caused a bit of a traffic jam on a busy stretch of the Trans-Canada Highway near Vancouver Saturday.
A British Columbia mayor has been censured by city council – stripping him of his travel and lobbying budgets and removing him from city committees – for allegedly distributing a book that questions the history of Indigenous residential schools in Canada.
Three men in Quebec from the same family have fathered more than 600 children.
A group of SaskPower workers recently received special recognition at the legislature – for their efforts in repairing one of Saskatchewan's largest power plants after it was knocked offline for months following a serious flood last summer.
A police officer on Montreal's South Shore anonymously donated a kidney that wound up drastically changing the life of a schoolteacher living on dialysis.