Stock markets finish roller-coaster week by falling further

North American stock markets ended a volatile week by losing more ground as healthy jobs reports reinforced that central banks would likely continue their sizable interest rate increases.

In Canada, the unemployment rate fell to a record low of 5.2 per cent in April, while 428,000 jobs were added in the U.S. to beat expectations.

The employment reports do nothing to quell expectations that the Bank of Canada and the Federal Reserve will hike rates by another 50 basis points at their next meetings to tackle inflation.

Colin Cieszynski, chief market strategist at SIA Wealth Management, said it used to be that when things were falling apart central banks would ride to the rescue.

“Well, now the narrative is kind of flipped to when anything that comes in good means that the central banks have room to tighten faster,” he said in an interview.

And that worries people because of the impact it would have on slowing the economy and hurting stock markets.

“We're probably starting to see more of the ones who had stuck it out, stayed optimistic and all the rest of it are now turning to throw in the towel more and more.”

The S&P/TSX composite index closed down 62.89 points to 20,633.28. It staged a rally after hitting an early low of 20,416.38.

It marked the sixth straight week of declines — the longest losing streak since 2014 — with Wednesday's positive move more than offset by two days of weakness.

“Even when we do get rallies like we had early in the week, they haven't been sustainable. The number of people who are looking to sell the rally is more than the number of people looking to buy the dip at this point,” said Cieszynski.

“We've got generally a risk-off tone across the world,” said Greg Taylor, a portfolio manager at Purpose Investments.

A lot of selling has been focused on technology due to a “massive change in investor perception for what sectors are going to work,” Taylor added.

In New York, the Dow Jones industrial average was down 98.60 points at 32,899.37. The S&P 500 index was down 23.53 points at 4,123.34, while the Nasdaq composite was down 173.03 points at 12,144.66. Eight of the 11 major sectors on the TSX were lower, led by technology.