North American stock markets were off to a rocky start Monday as lower oil prices and weak manufacturing data from China and the U.S. set a gloomy mood for investors on the first trading day of February.
The benchmark index of the Toronto Stock Exchange was down 204 points, or 1.6 per cent, to 12,618 at 10:15 a.m. ET.
The energy sector was leading all decliners, off 3.3 per cent. An $11 jump in the price of gold, to $1,127 US an ounce, boosted gold stocks.
Crude oil futures fell $1.37 to $32.25 US a barrel, reversing last week's solid gain. Natural gas futures tumbled even more, sliding 14 cents to $2.16 US per million BTUs, as much of the U.S. northeast basked in unseasonably warm weather.
Oil prices dropped after a Chinese factory purchasing manager survey fell to 49.4 in January, the lowest level in more than three years. Readings below 50 indicate contraction and suggest further weakness in the world's second-largest economy. Global stock markets were mixed.
The Dow Jones industrial average was down 101 points, or 0.6 per cent, to 16,366.
"There are precious few indicators that point to a recovery within China and this continues to spell bad news for the global economy which has been hugely reliant upon Chinese demand to help compensate for weak western demand post-2007," said Joshua Mahony, market analyst at IG.
U.S. stocks were also pressured by news from Institute for Supply Management that U.S. factory activity shrank more than expected in January. It was the fourth straight month of decline, as a strong U.S. dollar and weak demand overseas hurt U.S. manufacturers.
The Canadian dollar was up 0.01 cents to 71.41 cents US. The loonie gained 1.3 cents against its U.S. counterpart last week and some foreign exchange analysts think the downward movement on the loonie has been arrested, at least for the time being.
"Since the start of January, the tone of key data reports has shifted in the [Canadian dollar's] favour, mainly because key Canadian data releases have tended to surprise on the upside," noted Scotiabank chief foreign exchange strategist Shaun Osborne in a Monday report.
"Canadian international trade, wholesale trade, manufacturing sales, employment reports, for example, have all reported better-than-consensus outcomes."
0 nhận xét:
Đăng nhận xét