Toronto Stock Ex­change posts triple digit de­cline fol­low­ing plunge in China

The Guardian (Charlottetown) - - BUSINESS - THE CANA­DIAN PRESS

The Toronto Stock Ex­change reg­is­tered a triple-digit loss Mon­day, led by the re­source sec­tors, fol­low­ing a ma­jor sell-off in the Chi­nese mar­ket and weak­ness in oil.

The S&P/TSX com­pos­ite in­dex plunged 184.84 points to close at 14,001.37, while the loonie lost 0.06 of a cent at 76.66 cents US.

The move in Toronto came af­ter the Shang­hai share in­dex posted its big­gest one-day plunge since Fe­bru­ary 2007.

Nearly all of the sec­tors of the TSX closed lower, with the ex­cep­tion of health care. Re­sources fared es­pe­cially poorly, with the gold sec­tor los­ing more than four per cent, while met­als and min­ing lost 3.7 per cent, ma­te­ri­als lost 3.1 and energy closed 2.8 per cent lower.

China is a ma­jor im­porter of met­als and oil, which are heav­ily weighted sec­tors on the TSX.

The Septem­ber con­tract for crude oil fell 75 cents to US$47.39, while the Au­gust nat­u­ral gas con­tract gained 1.3 cents at US$2.789.

Gold — of­ten seen as a safe haven for in­vestors dur­ing times of eco­nomic tur­moil — closed higher, with the Au­gust con­tract gain­ing US$10.90 to US$1,096.40.

Brian Bel­ski, chief in­vest­ment strate­gist at BMO Cap­i­tal Mar­kets, says the re­ac­tion in Canada to the plunge in China demon­strates a broader is­sue — the de­gree to which in­vestors around the world are depend­ing on China as a growth en­gine.

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