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Tech stock sell-off continues as Nasdaq drops 10% in 3 days – CBC.ca

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Big tech stocks slumped again on Wall Street, pulling the Nasdaq down 10 per cent over the past three trading days.

The tech-heavy index dropped 4.1 per cent on  Tuesday, far worse than other indexes such as the Dow Jones Industrial Average and the S&P 500, which were both down by about 2.5 per cent, while Toronto’s benchmark stock index lost 118 points, or just under one per cent, to close at 16,099. That’s about where the TSX was at the end of July.

Tech stocks have been on a tear through the pandemic on expectations that they can continue to deliver strong profit growth almost regardless of the economy and global health, but many market-watchers have been saying the eye-popping gains were overdone. Last week shares in Facebook, Apple, Amazon, Tesla and others started sliding, and they haven’t stopped since.

Critics have long been saying that big technology stocks had shot too high, despite being growing and profitable companies. Such so-called “growth” stocks have been trouncing the performance of stocks that look like better bargains — called “value stocks” by investors — by margins wide enough to raise eyebrows along Wall Street.

“The growth versus value outperformance was at an unheard of extreme at the end of August,” said Sam Stovall, chief investment strategist at CFRA.

That gap began to narrow on Thursday, when tech stocks began cracking and the Dow fell more than 800 points, and that “showed investors that tech stocks and growth stocks can fall just as easily as they rise,” Stovall said.

Tesla has been one of the brightest examples of Big Tech’s furious movements. It surged 74.1 per cent in August alone. But it slumped 21 per cent on Tuesday on disappointment that the company won’t apparently be joining the S&P 500 any time soon.

The so-called FAANG stocks of Facebook, Apple, Amazon, Netflix and Google’s parent company have all done really well during the pandemic as demand for digital services has exploded. (Regis Duvignau/Reuters)

The company behind the S&P 500 announced on Friday the inclusion of several companies in the benchmark index, including Etsy. Some investors thought Tesla would be among them, which can create huge bouts of buying as index funds automatically fold the stock into their portfolios. 

“When this didn’t happen a lot of the people who were speculating on this ran for the exits,” said Colin Cieszynski market strategist at SIA Wealth Management, in an interview with CBC News.

Tesla has now lost about a third of its value in the past week.

Technology wasn’t the only thing lower though. Energy stocks fell as the price of oil tumbled. TSX-listed Suncor Energy lost eight per cent to fall to $18.53 as the oil giant revealed it will produce far less oil this quarter because of a fire that damaged one of its refineries.

Among the few gainers was General Motors. The automaker rose eight per cent after it said it’s taking an ownership stake in electric-vehicle company Nikola. GM will also engineer and build Nikola’s Badger hydrogen fuel cell and electric pickup truck as part of the partnership.

Nikola surged 39.2 per cent, on track for its best day since it doubled on June 8.

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Some airlines are now offering free COVID-19 insurance – CTV Toronto

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TORONTO —
Many people don’t feel safe flying amid the COVID-19 pandemic and there are still government warnings in place against non-essential travel.

That is why airlines are now offering free COVID-19 insurance coverage.

But at least one travel expert says that may not be enough of a reason to book a flight anytime soon.

Martin Firestone, the president of Travel Secure, said, “I think insurance companies are looking to get back some lost sales that don’t exist right now and the airlines are of course looking for business.”

Taking a flight is more stressful these days with social distancing, mandatory temperature checks and having to wear a mask for the duration of a flight.

Now as summer comes to an end this is the time of year that many Canadians plan vacations to Mexico, Cuba and other parts of the Caribbean, but due to COVID-19 many travelers may opt to stay home this winter.

In an effort to try filling seats, Air Canada and WestJet are now offering free COVID-19 insurance coverage on some flights of up to $100,000 and Manulife has announced it will roll out a COVID-19 policy in October that will provide up to $200,000 in coverage.

The coverage for someone testing positive for COVID-19 would pay for emergency hospital and medical costs, quarantine accommodations and transportation home via ambulance or air ambulance.

Firestone said people need to realize that if they get a serious case of COVID-19 while travelling in another country and are hospitalized and on a ventilator for weeks, the costs could add up to much more than the coverage currently being offered.

“A claim upward of a half a million dollars is a possibility and the insurance company’s exposure may be capped at $100,000 to $200,000. Who is going to pay the rest? That would be the consumer,” said Firestone.

Firestone said COVID-19 insurance policies come at a time when borders to the U.S. remain closed and the Canadian government continues to warn against non-essential travel.

“I think this is a marketing plan that someone has devised, but a lot of thought has not really gone into it, because it totally goes against the government’s position on travel at this time,” Firestone added.

Many Canadians will be tempted to book vacations to sunny destinations as the cold weather arrives, but Firestone said until travel advisories are lifted and there is a vaccine people may want to stay put.

“The next two or three months I’m suggesting to hold tight and stay home,” Firestone said.

Even though some airlines are including free COVID-19 insurance coverage that is not the same as travel medical insurance. If you book a trip you still need to pay for that yourself in case something else happens while you’re away.

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B.C. RCMP reminds Tesla owners not to push limits with automation feature – News 1130

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SURREY (NEWS 1130) — B.C. Mounties are reminding Tesla owners not to test the autonomous driving feature on our roads.

On Thursday, the RCMP said they had charged a man from B.C. with dangerous driving after an officer pulled over a speeding Tesla on a central Alberta highway that appeared to be driving itself in July.

According to the RCMP, the car appeared to be travelling over 140 km/h and both front seats were completely reclined and two people in the car appeared to be sleeping.

Cpl. Mike Halskov, with BC RCMP’s traffic services, says if you’re thinking of doing the same and testing out the autopilot system in your Tesla, please think again.

“I don’t think anyone should rely 100 per cent on any automated systems that are equipped with some vehicle. They’re not foolproof. And that is why steering wheels are still in vehicles, even the ones with automated systems in it because there does need to be the human component,” he says.

In the case of the Tesla in Alberta, a 20-year-old is accused of speeding and dangerous driving and has a court date in October.

RELATED: Sleeping driver of speeding Tesla on Alberta highway faces criminal charge: RCMP

While each traffic stop is different, Halskov says there are penalties under our Motor Vehicle Act you could face in B.C.

“If somebody is testing their automated systems and they’re taking liberty with the Motor Vehicle Act … [by] excessive speed or whatever the case may be, certainly those tickets would apply,” he says.

In some cases, the penalty could be worse, with a potential for a criminal charge depending on how dangerous the scenario is.

So for Tesla owners thinking of testing the feature, Halskov adds “You’re putting yourself and your passengers and the motoring public in harm’s way by doing so, and the outcome can be tragic for you and or other people, and obviously we don’t want that to happen.”

“So don’t rely 100 per cent on your automated systems in your car if you do have them. There does need to be driver input and the driver does need to be paying attention to what’s happening and have their hands on the wheel and providing some input where it may be required.”

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Desperation sets in as CERB is set to end; these three Canadians are among the millions living on the bubble – Toronto Star

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Canadians who’ve been relying on the Canada Emergency Response Benefit (CERB) to make ends meet during COVID-19 say there’s a sense of desperation and panic as the program nears its end later this month.

Stephanie Cohen was receiving EI payments before the pandemic as a result of losing her job as a copywriter at a digital marketing agency in Montreal. She transitioned to CERB in May and the $2,000 has kept her going since then.

The money has helped her pay basic bills and assisted her mother in buying groceries and other home necessities. Even though it’s less than what she was making at her work, it provided a much-needed financial boost and a little bit of “peace of mind” during a difficult period. Having zero income “would have been devastating,” she said.

As others do, she knows very little about the new benefits that will be offered to jobless Canadians starting Sept. 27.

“It is a pretty big concern, considering I’m in the category of people who exhausted their previous EI benefits,” Cohen said.

She’s especially worried new recovery programs, which are just proposals at this point and won’t be solidified until after the government’s Speech from the Throne on Sept. 23, will ignore people such as she, who were job-hunting prior to COVID-19. The pandemic, she said, put her hunt on hold and the economic hit to business across a variety of sectors makes it hard to know when people will start hiring again.

“I haven’t been able to receive a clear answer as to how I move forward,” she said about the lack of information on the upcoming benefit programs. “If I am not eligible to re-apply for EI, I’ll have zero income coming in, which would be a hard blow for me financially.”

A recent analysis from the Canadian Centre for Policy Alternatives warned millions of Canadians who depended on CERB will be hard hit by the upcoming change.

CERB had been instrumental in helping Jordan Troy, a Guelph resident who had just completed college and was looking for a job as an elevator mechanic when the pandemic hit. The 23-year-old said he recently started working a few hours a week at local restaurants when they reopened, but still makes less than $1,000 per month.

“I’m worried, of course. I don’t know if I will qualify for EI or any of the new programs, and there is no information right now,” he said. “At least with CERB, you knew you weren’t going to go hungry or miss a rent payment. Now everything is up in the air.”

Nick Cunningham had been working in the live music industry at a Toronto talent agency, helping with the booking of venues and organizing tours for Canadian artists. For the first few months of the pandemic, his agency managed to keep a small group of employees at work as they helped artists run virtual concerts and drive-in shows. But he was laid off last month.

“Everything was so sudden. I was working one day and the next day I wasn’t,” said Cunningham. “These past six months have been incredibly stressful, with so much uncertainty and repeated work, it felt like groundhog day every day, until I lost my job.”

So far, Cunningham has collected the CERB just twice. While he said he’s grateful for the support, he is “scared” that the switch to EI and other programs could leave him short of what he needs to get by.

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“It’s already hard to survive in Toronto on $2,000, and I feel like it’s about to get even harder with these new changes,” said Cunningham, who says special support for people in the live music industry is needed.

“Our government is not doing anything to address this industry’s shutdown, and I am getting anxious. I have spent my entire life getting to where I am now, and unfortunately things feel bleak with the soon-to-be removal of CERB.”

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