Toronto stocks rally, markets look headed for first plus day of year
TORONTO – North American investors appear headed for a calmer Friday after days of upheaval spurred by events surrounding China’s currency and two of its major stock markets.
Canada’s main stock market index, the S&P/TSX Composite, opened at 12,530.90 — up 82.69 points, or less than one per cent — after falling about 270 points on Thursday. That drove the Toronto Stock Exchange to level that signals a bear market — a 20 per cent decline from the index’s all-time high set in September 2014.
In New York, the Dow Jones average of 30 stocks gained 83.0 points at the open to 16,597.10, after falling nearly 400 points on Thursday. The broader S&P 500 index was initially flat at 1,943.09, while the Nasdaq gained 42.23 to 4,347.96..
Major stock indexes in Europe and Asia including the Shanghai Composite made slight gains Friday, after China’s central bank issued a statement promising it would aim for currency stability and China’s stock regulator suspended a new “circuit breaker” system that was triggered on Monday and Thursday — upsetting securities markets around the world.
The Canadian dollar remained below 71 cents U.S. near 12 1/2-year lows. It was at 70.84 cents U.S., down 0.10 of a cent from Thursday’s close at 70.94 cents U.S.
On the commodity markets, the February gold contract fell $5.90 to US$1,101.90 an ounce and the February crude contract was up two cents at US$33.29 per barrel.
WATCH: Economist Craig Alexander discusses how China’s stock market, slowdown is impacting Canada
On Thursday, the Toronto Stock Exchange’s S&P/TSX Composite index lost 278.59 points, or 2.2 per cent, to close at 12,448.21. In New York, the Dow Jones average of 30 stocks plummeted 392.41 points to 16,514.10, the broader S&P 500 index lost 47.17 points to 1,943.09, while the Nasdaq declined 146.33 points to 4,689.43.
Andrew Pyle, senior adviser and portfolio manager at Scotia Wealth Management, said it is the worst start to a new trading year for North American markets “in memory” but he doesn’t expect a repeat of the massive losses seen 2008.