Toronto stocks plunge as global markets extend sell-off

TORONTO – The Toronto Stock Exchange fell sharply at the opening bell on Wednesday and continued to plunge through morning trading, joining other markets around the world.

The Toronto Stock Exchange’s S&P/TSX index dropped 405.3 points, or about 3.4 per cent, to 11,596.88 at 11 a.m. ET – resuming an extended decline. On Tuesday, Canada’s largest stock market had only its third positive session since the Christmas break, rising 60.07 points.

In New York, the major indexes were also down significantly. The Dow Jones Industrial average fell 426.1 points to 15,592.01 (2.64 per cent). The broader S&P 500 index dropped 53.44 points to 1,827.89 (2.84 per cent) and the Nasdaq 100 lost 138.4 points to 4,338.60 (3.09 per cent).

“The ongoing turmoil in financial markets suggests something more troubling may be brewing in the real economy,” Benjamin Reitzes, economist at BMO Capital Markets, said.

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Major European indexes were also down more than two per cent in mid-session and markets in Hong Kong and Tokyo fell nearly four per cent.

The Canadian dollar came close to falling below 68 cents US in overnight trading amid further pressure on oil prices and uncertainty about what the Bank of Canada will do in response to weakened economic conditions.

The loonie was at 68.32 cents US – 0.27 of a cent below Tuesday’s close – shortly before the Bank of Canada’s latest interest rate announcement at 10 a.m. ET. Economists had been divided about whether it would drop interest rates.