Canada’s main stock index (TSX) went down to a 1.7 percent decline for the week. This is the biggest hit that Canada’s main stock index has experienced in several months, as commodity prices come under pressure.
The market dropped because of volatility in metals and mining, gold and financials stocks. The metals and mining sector dropped the most on the Toronto market, by 4.03 percent. The gold sector dropped 2.39 per cent.
The S&P/TSX composite index declined by 200.19 points, closing at 15,265.35.
Suncor Energy Inc went down by 2.5 percent to C$41.99, Encana Corp dropped by 2.5 percent to C$23.79, the Royal Bank of Canada dropped by 1.6 percent to C$81.80, Toronto-Dominion Bank declined by 1.7 percent to C$56.56, and Bank of Nova Scotia went down by 1.9 percent to C$71.56.
Rick Hutcheon, president and chief operating officer at RKH Investments, said:
“Energy has been the big drag this week, tied in to the decline in the price of oil we’ve seen.”
He added:
“We’ve come from the low $100s to the low $90s; that’s a pretty big drop. The perception is that the world is well supplied with oil right now.”
The drop in Canadian markets still occurred following optimism around the world about the outcome of Scotland – which will remain part of the United Kingdom. The fact that Scotland won’t be independent has been a relief for many investors as it reduces uncertainty about the future of the UK economy and the value of the pound sterling.
Kash Pashootan, vice-president and portfolio manager at First Avenue Advisory in Ottawa, said that “it certainly was believed by markets that this was the most profitable outcome,” adding that markets can now forget about the risks associated with an independent Scotland.
He concluded:
“The Scotland story is going to pass. It’s not going to be a topic of interest in the short term, with the vote clearly stating that they’re going to remain.”