Loss of Ground for Toronto Stock Market
Off late, Toronto Stock Market has been closing low, but better than the previous losses. Global recession has impacted the Canadian Stock Markets too.
The TSX was down by 25.43 points and closed down at 11335.77 bearing a loss of 0.22%.
The S&P was up by 0.14 points and closed at 1278.18 with a gain of 0.01%.
Wall Street experienced the Dow Jones industrial average falling by 17.11 points to 12,101.46.
Nasdaq closed at 2760.01 with a nominal gain of 12.53 points or 0.46%.
Canadian dollar experienced a slip of 0.03 of a cent to 96.18 cents US. This is a low in last few months.
Traders felt nervous and started flocking to the U.S. to gain some benefit and to recover the losses.
Information Technology sector saw the steepest decline on the TSX. The stock prices were down by 1.6%. A loss of another 6% was experienced by Research in Motion shares. This is equivalent to 65 cents or $10.03.
July crude contract on the New York Mercantile exchange closed up at 75 cents to US$83.98 a barrel. This affected the Energy Stocks and they all closed at lower prices.
According to a report from U.S. Commerce Department, there are more reasons to be worried about the economic conditions as fewer orders have been placed to U.S. factories. This is the second straight month when factory goods are down by 0.6 per cent in April from March.
Craig Fehr, Canadian markets Strategist at Edward jones in St. Louis, Mo said, “Concerns have been emanating out of Europe, for the better part of this year, potential for the government debt crisis there to become a financial catastrophe around the world.”
He also added that the “focus is quickly moving towards the prospects for the global economy to really shift into a lower gear.”
According to him, “This has a direct impact on commodity prices and resource prices, which is filtering its way back into the Canadian market, to some degree.”
Amid all this, the Bank of Canada is expected to leave its key rate unchanged at 1%. Mark Carney, Governor of Bank of Canada seems to be in no mood to hike the interest rates this year due to slow economy of the world.
A report released on Monday shows an unemployment rate of 11% in April in the 17 countries using euro currency. This is considered to be a very high unemployment rate.