North American stocks slide lower, loonie down against U.S. dollar
S&P/TSX composite index closes at 6-month low
Canada's main stock index hit a six-month low Thursday while U.S. stock markets suffered another sell-off day as investors are pricing in political and trade uncertainties they've long overlooked.
The result is they have now woken up to issues that have existed for the last six to 12 months, says Kash Pashootan, CEO and chief investment officer at First Avenue Investment Counsel Inc.
"The longer they shrug them off the more of a price we have to pay at some point," he said in an interview.
"When you're trying to price in uncertainties that have existed for six, 12, 18 months over four or five trading sessions, of course you're going to feel that in the markets."
The S&P/TSX composite index closed down 200.27 points to 15,317.13, the lowest level since April with 389 million shares traded.
The 1.3 per cent sell-off came a day after the TSX shed more than 330 points in the largest one-day decline in more than three years.
I would not be surprised if we saw a 10 to 15 per cent correction.- Kash Pashootan, CEO, First Avenue Investment Counsel
Energy posted the largest decrease, falling 3.37 per cent in a pullback from steady gains. The November crude contract was down US$2.20 at $70.97 US per barrel.
Gold stocks rose nearly eight per cent as the price of gold hit its highest level since August as investors sought a hedge against uncertainty. The December gold contract was up $34.20 US at $1,227.60 US an ounce.
In New York, the Dow Jones industrial average was down 545.91 points to 25,052.83 after dropping more than 800 points on Wednesday. All companies were in the red for a second-straight day. The S&P 500 index was down 57.31 points to 2,728.37, while the Nasdaq composite was down 92.99 points at 7,329.06.
Bumpy ride not likely over
Pashootan says the hemorrhage likely hasn't ended.
"I would not be surprised if we saw a 10 to 15 per cent correction in the market," he said, noting that the S&P 500 had gone 74 consecutive days without any plus or minus move above one per cent.
Even sophisticated and experienced investors have become accustomed over the last decade to a pretty easy ride in equities, he said.
The Canadian dollar traded at an average of 76.70 cents US compared with an average of 76.97 cents US on Wednesday.
The November natural gas contract was down 6.2 cents at $3.22 US per million British thermal units.
The December gold contract was up $34.20 US at $1,227.60 US an ounce and the December copper contract was up 2.25 cents at $2.80 US a pound.