{"id":7667,"date":"2008-10-02T16:27:36","date_gmt":"2008-10-02T21:27:36","guid":{"rendered":"http:\/\/blog.jackjia.com\/?p=7667"},"modified":"2010-02-10T22:55:44","modified_gmt":"2010-02-11T03:55:44","slug":"20081002%e4%b8%80%e5%91%a8%e5%86%85tsx%e7%ac%ac%e4%ba%8c%e6%ac%a1%e6%97%a5%e8%b7%8c800%e7%82%b9","status":"publish","type":"post","link":"https:\/\/blog.jackjia.com\/?p=7667","title":{"rendered":"20081002\/\u4e00\u5468\u5185TSX\u7b2c\u4e8c\u6b21\u65e5\u8dcc800\u70b9"},"content":{"rendered":"

TSX closes 813 points down<\/strong>
\nData, uncertainty over bailout depresses Wall Street<\/p>\n

Oct 02, 2008 05:02 PM <\/p>\n

Kristine Owram
\nTHE CANADIAN PRESS<\/p>\n

The Toronto stock market had its second 800-plus drop in less than a week today, and had its lowest close since June 2006, while New York indexes also ran deeply into the red.<\/p>\n

Toronto’s S&P\/TSX composite fell 813.97 points or seven per cent to 10,900.54. On Monday, the market made history by plunging 840.93 points, slightly more than a record set in October 2000.<\/p>\n

Today’s slide on Canada’s largest stock market was led by Potash Corp. of Saskatchewan (TSX: POT) and Agrium Inc. (TSX: AGU) as major brokerage Merrill Lynch cut its ratings for global fertilizer makers and said it expects earnings to fall.<\/p>\n

Oil company shares were also down as the November crude contract on the New York Mercantile Exchange declined $4.56 to US$93.97 a barrel.<\/p>\n

The TSX Venture Exchange moved down 94.69 points to 1,311.96.<\/p>\n

The Canadian dollar fell 1.56 cents to 92.6 cents US. The dollar has dropped more than four cents since Friday.<\/p>\n

In New York, markets were dragged lower as traders responded to disappointing economic data and assessed the prospects for a U.S. government bailout of the financial system.<\/p>\n

The Dow Jones industrial average lost 348.22 points to 10,482.85.<\/p>\n

The Nasdaq composite index was down 92.68 at 1,976.72 while the S&P 500 declined 46.78 to 1,114.28.<\/p>\n

Vincent Delisle, a portfolio strategist with Scotia Capital, said the markets seem to be responding to fear that the U.S. government’s financial rescue plan might not be enough to ward off a recession.<\/p>\n

“Getting a package done is heading in the right direction, but it doesn’t take away the risk that we’re probably already in a recession in the U.S. and the data just got uglier,” Delisle said in an interview.<\/p>\n

“Recession fears are really ruling this market.”<\/p>\n

The Senate voted 74-25 Wednesday night to approve the Bush administration’s package, which now moves to the House for a vote expected Friday.<\/p>\n

Since the lower house of Congress rejected the bailout Monday, the proposal has been sweetened with $100 billion in tax breaks and an increase in the limit on federal insurance of bank deposits to $250,000. The cost of the bill to taxpayers is now close to $1 trillion.<\/p>\n

The White House says the need is urgent for the taxpayers to buy hundreds of billions of dollars in bad debts in an effort to free up credit markets.<\/p>\n

Banks are fearful of making loans, restricting the availability of cash to businesses and consumers alike.<\/p>\n

Gareth Watson, Canadian equity adviser at ScotiaMcLeod, said volatile financial markets are in “uncharted territory,” prompting “knee-jerk reaction” from traders. Today’s dramatic declines despite improving prospects for the bailout bill show that the package isn’t the solution to U.S. economic woes, he added.<\/p>\n

“This bailout package is only the first in many, many steps that need to be taken in order to get stability in the credit markets, hopefully stability in the U.S. housing market as well, and if you can create those two things, then at least you can create an environment where we might be able to see a turnaround in the U.S. economy,” Watson said in an interview.<\/p>\n

“My personal view is the whole idea of this bailout package is a gesture that the U.S. government is on-side versus the absolute solution to everyone’s problems.”<\/p>\n

In economic news, U.S. government data showed applications for unemployment benefits rose slightly last week to a seven-year high \u2013 well above analyst expectations. The seasonally adjusted number of 497,000 was the highest since just after the Sept. 11 terrorist attacks in 2001.<\/p>\n

As well, the U.S. Commerce Department reported today that orders for manufactured goods dropped by four per cent in August, compared to July. That’s a much worse performance than the 2.5 per cent decline that economists had expected.<\/p>\n

The weakness was led by big declines in orders for aircraft, down 38.1 per cent, and autos, which fell by 10.6 per cent, the worst performance in nearly six years.<\/p>\n

Meanwhile, U.S. regulators have extended the ban on short-selling of more than 800 financial company shares.<\/p>\n

The credit markets showed some increased strain today. The yield on the three-month U.S. Treasury bill, the safest type of investment, fell to 0.7 per cent from 0.79 per cent late Wednesday. The historically low yields indicate investors are willing to accept the smallest of returns to safeguard their money.<\/p>\n

In Toronto, PricewaterhouseCoopers reported today that for the first time in recent memory, there were no initial public offerings on the Toronto Stock Exchange during the third quarter.<\/p>\n

It was the weakest new-issue activity on the TSX ever tracked by the accounting and consulting firm, continuing a downward trend which started more than a year ago. The previous low in TSX new issues was four during the third quarter of last year.<\/p>\n

Potash Corp. was down $35.50 or 26 per cent to $101 and Agrium fell $13.47 or 23 per cent to $45.01 as the bloom continued to come off the fertilizer boom.<\/p>\n

The TSX financial sector was down 3.4 per cent, while the energy group lost 8.6 per cent.<\/p>\n

EnCana (TSX: ECA) was down $6 to $59.46 while Suncor Energy (TSX: SU) lost $4.70 to $36.<\/p>\n

The metals sector lost 10.1 per cent with Teck Cominco (TSX: TCK.B) down $3.59 to $24.32.<\/p>\n

The gold sector plunged 16.2 per cent as the December bullion price on the New York Mercantile Exchange declined $43 to US$844.30 per ounce.<\/p>\n

Goldcorp (TSX: G) was down $6.81 or 20 per cent to $27.51 while Barrick Gold (TSX: ABX) fell $6.52 or 16 per cent to $33.25.<\/p>\n","protected":false},"excerpt":{"rendered":"

TSX closes 813 points down Data, uncertainty over bailout depresses Wall Street Oct 02, 2008 05:02 PM Kristine Owram THE CANADIAN PRESS The Toronto st…
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