Choppy trading drags TSX lower; Greece warned
The Toronto Stock Exchange has closed lower Thursday as a day of choppy trading saw most of the sectors declining. Commodity prices, which had been rebounding, slipped back hurting energy and mining shares. A ripple effect from Europe, where Greece was told to stop asking for too much or it will be financially ruined, also added to negativity. Despite Greek debt talks dragging on European markets closed slightly up. Wall Street gained as positive retail data offset losses. Asia closed higher with Chinese economic data no worse than expected and South Korea announcing a cut in interest rates.
The S&P/TSX Composite Index closed down 58.16 (0.39 per cent)
The NYSE closed higher
Oil is trending lower (Brent $64.99, WTI $60.68 at 4.20pm)
Gold is trending lower
The loonie is valued at U$0.8141 (at 4.30pm)
BoC warns of housing crash, oil prices
Canada’s financial system is in pretty good shape the Bank of Canada reported Thursday. However the threat of a housing market crash and lower oil prices are the top concerns. The central bank’s twice-yearly review of the nation’s financial health revealed that the risks have increased slightly but do not warrant a change in monetary policy at this time. The threat of a housing crash is connected to a decline in jobs and therefore income; the BoC is concerned that high household debt would then lead to defaults including issues for the housing market. Long term interest rate rises in Canada and globally are also a risk the report said.
Oil demand up says EIA, glut continues
The International Energy Agency says that although there is an increase in global demand for oil, there is also still a large supply glut. Along with growing demand the cut in production from non-OPEC countries has helped cut the gap between supply and demand. The report said that China has cut its demand for industrial purposes while increasing the need for gasoline as more Chinese drive. The US, Canada and Europe are also entering the higher-demand summer period. Global demand is now at 94 million barrels a day with production at 96 million.
More Canadians becoming insolvent
There’s been an increase in the number of insolvencies in Canada according to a report from CIBC. Cumulative insolvency numbers rose 1.2 per cent in the six months to the end of February, the first rise since the recession. Personal bankruptcies are down by 4.7 per cent but have been surpassed by a 9 per cent increase in proposals, where debtors only repay a portion of their debt.