TSX bears brunt as rebound hopes fade
The Toronto stock market closed lower Friday and racked up its second weekly loss in a row as a string of disappointing economic data was capped by a U.S. jobs report that widely missed expectations. Collectively, the data have raised even more doubts that the surge in stocks since early March can be sustained.
The S&P/TSX composite index lost 113.43 points to 10,958.33 after the labour department reported job losses hit 263,000, increasing the U.S. unemployment rate one-tenth of a point to 9.8 per cent, the highest level since June 1983.
"There’s been a lot of talk, particularly in the last couple of months, that we’re seeing a turnaround in unemployment, and obviously that’s not the case," said Dan Cook, senior market analyst at IG Markets in Chicago.
The main TSX index fell 254 points, or 2.26 per cent, this week in the wake of a report showing Canadian economic growth flat at mid-summer, along with disappointing U.S. manufacturing and consumer sentiment reports.
Hopes for a strong rebound have fuelled the muscular rise in markets this year. The TSX’s main index surged almost 10 per cent in the third quarter alone.
The Canadian dollar rose to 92.38 cents (U.S.), up 0.17 of a cent.
The financial sector was the leading decliner, down almost 2 per cent pay day loan. Scotiabank fell $1.93 (Canadian) to $46.10.
TD Bank shares were down $1.53 to $65.17 after it said it would reimburse customers who incur fees because of computer problems at a U.S. subsidiary that delayed transaction postings all week. TD said the problems came about as it integrated computer systems of the old TD Banknorth and Commerce Bank, acquired last year.
The energy sector also pulled down the TSX, falling 1.17 per cent as the November crude contract on the New York Mercantile Exchange slipped 87 cents (U.S.) to $69.95 a barrel. The TSX Venture Exchange slipped 4.59 points to 1,244.12.
U.S. markets closed lower as the Dow Jones industrials fell 21.61 points to 9,487.67, losing 177.52 points, or 1.83 per cent, this week. The Nasdaq composite index edged 9.37 points lower to 2,048.11, while the S&P 500 index was off 4.64 points to 1,025.21.
The TSX gold sector was flat as the December bullion contract on the Nymex shook off early losses to advance $3.60 to $1,004.30.
The Canadian Press
Filed under: finance by Forest