TORONTO —
Major North American indexes continued to plunge Thursday as news of large-scale cancellations failed to ease investors’ concerns about the spread of the novel coronavirus pandemic.
“This is an unprecedented fall,” said Allan Small, senior investment adviser at HollisWealth, who has been working in the investment world for almost 25 years.
“I have never seen the velocity of this fall as steep or quick as it is.”
The S&P/TSX composite index plummeted 1,761.64 points, or 12.34 per cent, to 12,508.45 with every sector in the red and just above a daily low of 12,451.12 points.
In New York, the Dow Jones industrial average dropped 2,352.60 points, or 9.99 per cent, to 21,200.62. That’s the worst day for the index since a nearly 23 per cent drop on Oct. 19, 1987.
The S&P 500 index shed 260.74 points, or 9.51 per cent, to 2,480.64. That’s a total drop of 26.7 per cent from its all-time high set just last month, well past the threshold for a bear market. It snaps an unprecedented nearly 11-year bull-market run.
The Nasdaq composite fell by 750.25 points, or 9.43 per cent, to 7,201.80.
The collapse in Toronto and on U.S. markets at the start of trading was large enough to trip circuit breakers that forced a pause in trading.
Stock markets had been under pressure in recent weeks amid concerns about the spread of COVID-19, however losses picked up this week after Saudi Arabia moved to boost oil production in a price war with Russia.
European markets did not fare well either. They lost 12 per cent in one of their worst days ever.
The market is trying to determine how much companies are worth, said Small.
“It doesn’t know because we don’t know how long this virus will linger and how long it will have an impact on business,” he said.
On Wednesday, investors hoped U.S. President Donald Trump “would give us something to hang out hats on,” but his prime-time address disappointed Wall Street, said Small.
Trump announced travel restrictions on Europe that aim to limit the virus from spreading and hinted at plans for tax cuts and other economic relief, but did not provide details.
Small said investors need to hear that the government is here to help and no business will be left behind during the outbreak.
Even gold, normally considered a safe haven for investors during tumultuous times, plummeted. The April gold contract declined by US$52.00 to US$1,590.30 an ounce.
For individual investors watching the balance of their RRSPs, TFSAs or other accounts dwindle, Small said: “take a deep breath.”
For those who can’t stand the dramatic drops, he said, there is the option to pull their money out of the market. Though, he cautioned, he believes that would be a mistake.
The other choice, Small said, is to stay in the market, avoid looking at their portfolio for several weeks and wait for a rebound.
He notes these choices do depend on each investor’s investment horizon and other factors.
The only positive today, said Small, is that there is no positive.
“The positive could be maybe we’re finally at a bottom. I don’t know if it’s exactly today, but maybe it’s somewhere around here.”
The Canadian dollar traded for 72.36 cents US compared with an average of 72.75 cents US on Wednesday.
Elsewhere in commodities, the April crude contract fell US$1.48 to US$31.50 per barrel and the April natural gas contract shed 3.7 cents to US$1.841 per mmBTU. The May copper contract dropped by nearly 3 cents to roughly US$2.47 a pound.
This report by The Canadian Press was first published March 12, 2020.
HALIFAX – Ottawa is negotiating a $500-million bailout for Nova Scotia’s privately owned electric utility, saying the money will be used to prevent a big spike in electricity rates.
Federal Natural Resources Minister Jonathan Wilkinson made the announcement today in Halifax, saying Nova Scotia Power Inc. needs the money to cover higher costs resulting from the delayed delivery of electricity from the Muskrat Falls hydroelectric plant in Labrador.
Wilkinson says that without the money, the subsidiary of Emera Inc. would have had to increase rates by 19 per cent over “the short term.”
Nova Scotia Power CEO Peter Gregg says the deal, once approved by the province’s energy regulator, will keep rate increases limited “to be around the rate of inflation,” as costs are spread over a number of years.
The utility helped pay for construction of an underwater transmission link between Newfoundland and Nova Scotia, but the Muskrat Falls project has not been consistent in delivering electricity over the past five years.
Those delays forced Nova Scotia Power to spend more on generating its own electricity.
This report by The Canadian Press was first published Sept. 16, 2024.
TORONTO – Roots Corp. may have built its brand on all things comfy and cosy, but its CEO says activewear is now “really becoming a core part” of the brand.
The category, which at Roots spans leggings, tracksuits, sports bras and bike shorts, has seen such sustained double-digit growth that Meghan Roach plans to make it a key part of the business’ future.
“It’s an area … you will see us continue to expand upon,” she told analysts on a Friday call.
The Toronto-based retailer’s push into activewear has taken shape over many years and included several turns as the official designer and supplier of Team Canada’s Olympic uniform.
But consumers have had plenty of choice when it comes to workout gear and other apparel suited to their sporting needs. On top of the slew of athletic brands like Nike and Adidas, shoppers have also gravitated toward Lululemon Athletica Inc., Alo and Vuori, ramping up competition in the activewear category.
Roach feels Roots’ toehold in the category stems from the fit, feel and following its merchandise has cultivated.
“Our product really resonates with (shoppers) because you can wear it through multiple different use cases and occasions,” she said.
“We’ve been seeing customers come back again and again for some of these core products in our activewear collection.”
Her remarks came the same day as Roots revealed it lost $5.2 million in its latest quarter compared with a loss of $5.3 million in the same quarter last year.
The company said the second-quarter loss amounted to 13 cents per diluted share for the quarter ended Aug. 3, the same as a year earlier.
In presenting the results, Roach reminded analysts that the first half of the year is usually “seasonally small,” representing just 30 per cent of the company’s annual sales.
Sales for the second quarter totalled $47.7 million, down from $49.4 million in the same quarter last year.
The move lower came as direct-to-consumer sales amounted to $36.4 million, down from $37.1 million a year earlier, as comparable sales edged down 0.2 per cent.
The numbers reflect the fact that Roots continued to grapple with inventory challenges in the company’s Cooper fleece line that first cropped up in its previous quarter.
Roots recently began to use artificial intelligence to assist with daily inventory replenishments and said more tools helping with allocation will go live in the next quarter.
Beyond that time period, the company intends to keep exploring AI and renovate more of its stores.
It will also re-evaluate its design ranks.
Roots announced Friday that chief product officer Karuna Scheinfeld has stepped down.
Rather than fill the role, the company plans to hire senior level design talent with international experience in the outdoor and activewear sectors who will take on tasks previously done by the chief product officer.
This report by The Canadian Press was first published Sept. 13, 2024.
VANCOUVER – Mediated talks between the union representing HandyDART workers in Metro Vancouver and its employer, Transdev, are set to resume today as a strike that has stopped most services drags into a second week.
No timeline has been set for the length of the negotiations, but Joe McCann, president of the Amalgamated Transit Union Local 1724, says they are willing to stay there as long as it takes, even if talks drag on all night.
About 600 employees of the door-to-door transit service for people unable to navigate the conventional transit system have been on strike since last Tuesday, pausing service for all but essential medical trips.
Hundreds of drivers rallied outside TransLink’s head office earlier this week, calling for the transportation provider to intervene in the dispute with Transdev, which was contracted to oversee HandyDART service.
Transdev said earlier this week that it will provide a reply to the union’s latest proposal on Thursday.
A statement from the company said it “strongly believes” that their employees deserve fair wages, and that a fair contract “must balance the needs of their employees, clients and taxpayers.”
This report by The Canadian Press was first published Sept. 12, 2024.
