Canada’s main stock index plunged more than 300 points in late-morning trading, adding to its losses a day ago, while U.S. stock markets also sank again.
The S&P/TSX composite index fell 345.05 points to 16,103.84.
In New York, the Dow Jones industrial average was down 530.25 points at 27,762.48. The S&P 500 index was down 86.38 points at 3,368.68, while the Nasdaq composite was down 426.87 points at 11,031.23.
The Canadian dollar traded for 76.23 cents US compared with 76.20 cents US on Thursday.
The October crude contract was down US$1.43 at US$39.94 per barrel and the October natural gas contract was down four cents at US$2.44 per mmBTU.
The December gold contract was down US$13.70 at US$1,924.10 an ounce and the December copper contract was up four cents at US$3.02 a pound.
UPDATE: 7:45 a.m.
Stocks are falling again on Wall Street in early trading Friday, adding to the market’s losses after its biggest sell-off since June.
The S&P 500 was down 1.2% after initially climbing 0.7% shortly after trading opened. Another slide in technology stocks, which led the selling a day earlier, outweighed gains in financial, industrial companies and elsewhere in the market. Declines in communications stocks and companies that rely on consumer spending also weighed on the market. The benchmark index remains on track for its first weekly loss after five weeks of gains.
Stocks fell after the Labor Department said that U.S. hiring slowed to 1.4 million last month, the fewest jobs since the pandemic began, even as the nation’s unemployment rate improved to 8.4% from 10.2%. The U.S. economy has recovered about half the 22 million jobs lost to the pandemic.
The Dow Jones Industrial Average was down 189 points, or 0.6%, to 28,110 as of 10:20 a.m. Eastern time. It lost more than 800 points on Thursday. The technology-heavy Nasdaq was down 3% a day after a 5% skid.
Treasury yields headed higher, a sign that some investors were less pessimistic about the economy. The 10-year Treasury yield rose to 0.67%, up from 0.62% late Thursday.
ORIGINAL: 7:09 a.m.
Canada’s main stock index was up in early trading, helped by gains in the financial, industrial and metals and mining sectors.
The S&P/TSX composite index was up 32.21 points at 16,481.10.
Stocks opened higher on Wall Street Friday, a day after a big slump in technology companies pulled the market to its biggest drop since June.
In New York, the Dow Jones industrial average was up 199.92 points at 28,492.65. The S&P 500 index was up 9.08 points at 3,464.14, while the Nasdaq composite was down 38.72 points at 11,419.38.
Traders were encouraged to see a drop in the unemployment rate last month, even as hiring slowed. Treasury yields rose after the government’s monthly jobs report came out, a sign that investors are becoming less pessimistic about the economy.
The higher yields helped send bank stocks higher, since banks can lend money at higher rates once yields rise in the bond market.
European shares also opened higher on Friday and U.S. futures bounced back after a day of losses in Asia.
Germany’s DAX gained 0.4% to 13,101.39 and the CAC 40 in Paris jumped 0.8% to 5,048.18. Britain’s FTSE 100 climbed 0.4% to 5,874.37. U.S. shares looked set for a comeback, with the future for the S&P 500 up 0.3% and that for the Dow industrials 0.5% higher.
There was little going on in Asia to alter the markets’ downward trajectory after the U.S. benchmark S&P 500 gave up 3.5% on Thursday, its biggest loss in three months, and the Nasdaq fell 5% as high-flying technology companies took a tumble after months of spectacular gains.
There seemed to be no obvious trigger for the sell-off, with economic data coming in roughly where the market had expected and no companies issuing foreboding warnings. But the market felt due for a breather, analysts said.
“Altitude sickness?” asked Riki Ogawa of Mizuho Bank. “To be sure, the plunge after overly exuberant rallies of recent was in itself not counter-intuitive; but the precise motivation of, and triggers for, market moves remains an enigma.”
“While I don’t think its a healthy meltdown, getting rid of some of the short term speculator froth will offer up better levels for the Wall of Money to indulge as we know the Fed is not going anywhere soon,” Stephen Innes of AxiCorp said in a commentary.
The Nikkei 225 shed 1.1% to 23,205.43 while the Hang Seng in Hong Kong lost 1.3% to 24,095.45. Australia’s S&P/ASX 200 gave up 3.1% to 5,925.50 and the Shanghai Composite index slipped 0.9% to 3,355.37. South Korea’s Kospi lost 1.2% to 2,368.25.
Wall Street’s unloading of technology shares on Thursday ended with Apple plunging 8%. Amazon lost 4.6% and Facebook gave back 3.8%.
Even with Thursday’s losses, Apple is still up 64.7% for the year, and Amazon is up 82.3%. Zoom’s gain for the year is still a whopping 460.4%.
The gains have been based on rosy assumptions about the virus’s impact on the economy, as well as on prospects for Congress and the White House coming up with another economic relief package.
The Canadian dollar traded for 76.30 cents US this morning, compared with 76.20 cents US on Thursday.
MONTREAL – Travel company Transat AT Inc. reported a loss in its latest quarter compared with a profit a year earlier as its revenue edged lower.
The parent company of Air Transat says it lost $39.9 million or $1.03 per diluted share in its quarter ended July 31.
The result compared with a profit of $57.3 million or $1.49 per diluted share a year earlier.
Revenue in what was the company’s third quarter totalled $736.2 million, down from $746.3 million in the same quarter last year.
On an adjusted basis, Transat says it lost $1.10 per share in its latest quarter compared with an adjusted profit of $1.10 per share a year earlier.
Transat chief executive Annick Guérard says demand for leisure travel remains healthy, as evidenced by higher traffic, but consumers are increasingly price conscious given the current economic uncertainty.
This report by The Canadian Press was first published Sept. 12, 2024.
Dollarama Inc.’s food aisles may have expanded far beyond sweet treats or piles of gum by the checkout counter in recent years, but its chief executive maintains his company is “not in the grocery business,” even if it’s keeping an eye on the sector.
“It’s just one small part of our store,” Neil Rossy told analysts on a Wednesday call, where he was questioned about the company’s food merchandise and rivals playing in the same space.
“We will keep an eye on all retailers — like all retailers keep an eye on us — to make sure that we’re competitive and we understand what’s out there.”
Over the last decade and as consumers have more recently sought deals, Dollarama’s food merchandise has expanded to include bread and pantry staples like cereal, rice and pasta sold at prices on par or below supermarkets.
However, the competition in the discount segment of the market Dollarama operates in intensified recently when the country’s biggest grocery chain began piloting a new ultra-discount store.
The No Name stores being tested by Loblaw Cos. Ltd. in Windsor, St. Catharines and Brockville, Ont., are billed as 20 per cent cheaper than discount retail competitors including No Frills. The grocery giant is able to offer such cost savings by relying on a smaller store footprint, fewer chilled products and a hearty range of No Name merchandise.
Though Rossy brushed off notions that his company is a supermarket challenger, grocers aren’t off his radar.
“All retailers in Canada are realistic about the fact that everyone is everyone’s competition on any given item or category,” he said.
Rossy declined to reveal how much of the chain’s sales would overlap with Loblaw or the food category, arguing the vast variety of items Dollarama sells is its strength rather than its grocery products alone.
“What makes Dollarama Dollarama is a very wide assortment of different departments that somewhat represent the old five-and-dime local convenience store,” he said.
The breadth of Dollarama’s offerings helped carry the company to a second-quarter profit of $285.9 million, up from $245.8 million in the same quarter last year as its sales rose 7.4 per cent.
The retailer said Wednesday the profit amounted to $1.02 per diluted share for the 13-week period ended July 28, up from 86 cents per diluted share a year earlier.
The period the quarter covers includes the start of summer, when Rossy said the weather was “terrible.”
“The weather got slightly better towards the end of the summer and our sales certainly increased, but not enough to make up for the season’s horrible start,” he said.
Sales totalled $1.56 billion for the quarter, up from $1.46 billion in the same quarter last year.
Comparable store sales, a key metric for retailers, increased 4.7 per cent, while the average transaction was down2.2 per cent and traffic was up seven per cent, RBC analyst Irene Nattel pointed out.
She told investors in a note that the numbers reflect “solid demand as cautious consumers focus on core consumables and everyday essentials.”
Analysts have attributed such behaviour to interest rates that have been slow to drop and high prices of key consumer goods, which are weighing on household budgets.
To cope, many Canadians have spent more time seeking deals, trading down to more affordable brands and forgoing small luxuries they would treat themselves to in better economic times.
“When people feel squeezed, they tend to shy away from discretionary, focus on the basics,” Rossy said. “When people are feeling good about their wallet, they tend to be more lax about the basics and more willing to spend on discretionary.”
The current economic situation has drawn in not just the average Canadian looking to save a buck or two, but also wealthier consumers.
“When the entire economy is feeling slightly squeezed, we get more consumers who might not have to or want to shop at a Dollarama generally or who enjoy shopping at a Dollarama but have the luxury of not having to worry about the price in some other store that they happen to be standing in that has those goods,” Rossy said.
“Well, when times are tougher, they’ll consider the extra five minutes to go to the store next door.”
This report by The Canadian Press was first published Sept. 11, 2024.
TORONTO – The U.S. Consumer Financial Protection Bureau has ordered TD Bank Group to pay US$28 million for repeatedly sharing inaccurate, negative information about its customers to consumer reporting companies.
The agency says TD has to pay US$7.76 million in total to tens of thousands of victims of its illegal actions, along with a US$20 million civil penalty.
It says TD shared information that contained systemic errors about credit card and bank deposit accounts to consumer reporting companies, which can include credit reports as well as screening reports for tenants and employees and other background checks.
CFPB director Rohit Chopra says in a statement that TD threatened the consumer reports of customers with fraudulent information then “barely lifted a finger to fix it,” and that regulators will need to “focus major attention” on TD Bank to change its course.
TD says in a statement it self-identified these issues and proactively worked to improve its practices, and that it is committed to delivering on its responsibilities to its customers.
The bank also faces scrutiny in the U.S. over its anti-money laundering program where it expects to pay more than US$3 billion in monetary penalties to resolve.
This report by The Canadian Press was first published Sept. 11, 2024.
