Markets

Canadian Shares Deep Down In The Red As Virus Worries Mount

(RTTNews) - Canadian stocks are deep down in the red Wednesday morning as investors go on a selling-spree amid mounting worries about growth due to sharp spikes in coronavirus cases across the world.

The Canadian dollar slipped against its most major counterparts in the New York session on Wednesday, after the Bank of Canada left its interest rate unchanged and recalibrated the QE program to conduct purchases of longer-term bonds.

The BOC maintained its benchmark rate at 0.25%, as expected. The bank said that it is recalibrating the QE program to shift purchases towards longer-term bonds, which have more direct influence on the borrowing rates that are most important for households and businesses.

The total purchases will be gradually reduced to at least C$4 billion a week. The bank said it will continue the QE program until the recovery is well underway.

"The Governing Council will hold the policy interest rate at the effective lower bound until economic slack is absorbed so that the 2% inflation target is sustainably achieved," it said.

In the U.S., daily new coronavirus cases have risen by a record average of 69,967 over the past week, data from John Hopkins University showed. The report said the jump in new cases has also been accompanied by an increase in hospitalizations and deaths, raising worries about possible new lockdowns.

The U.S. saw more than 73,000 new confirmed cases on Tuesday, the report said.

Materials and energy stocks are tumbling due to sharp declines in commodity prices. Several shares from information technology, consumer discretionary, healthcare and financial sections are down with sharp losses.

The benchmark S&P/TSX Composite Index, which opened with a big negative gap of about 200 points at 15,821.26, was down 244.79 points or 2.2% at 15,676.25 a little while ago.

The Capped Materials Index is plunging 4.4% and the Energy index is down nearly 4%. With several key stocks in the section sliding, the Consumer Discretionary Index is lower by about 2.7%. The Information Technology Index is down sharply as well, losing about 2.4%.

Among the stocks that have tumbled on large volumes, Kinross Gold (K.TO) is down more than 8%, Yamana Gold (YRI.TO) is plunging 7.2% and B2Gold Corp (BTO.TO) is declining 6.8%.

Whitecap Resources (WCP.TO), Husky Energy (HSE.TO), Bombardier Inc. (BBD.B.TO), Suncor Energy (SU.TO), Air Canada (AC.TO), Barrick Gold Corporation (ABX.TO), Cenovus Energy (CVE.TO) and Teck Resources (TECK.B.TO) are down 2.5 to 6%.

In the U.S. market, the major averages are all down sharply. The Dow is down 2.85%, the S&P 500 is lower by 2.8% and the Nasdaq is plunging 2.75%.

The major European markets are falling as well. The U.K.'s FTSE 100 is down 3.2%, Germany's DAX is sliding 4.4% and France's CAC 40 is plunging nearly 4%. The pan European Stoxx 600 is down by about 3.3%.

In commodities, WTI Crude oil futures for December are down $2.07 or 5.2% at $37.50 a barrel.

Gold futures are down $37.80 or nearly 2% at $1,874.10 an ounce, while Silver futures are down $1.385 or 5.6% at $23.185 an ounce.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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