North American markets swung wildly between positive and negative territory on Tuesday in volatile trading after Wall Street’s rout yesterday heightened concerns that a pull-back from record highs could lead to more heavy losses.
The benchmark Dow Jones industrial average was up 0.1 per cent, or 30 points, to 24,375.61 at after losing about 500 points at the opening of trading.
It had lost 1,175 points or 4.6 per cent yesterday — marking its largest daily points drop in its history.
But Benjamin Reitzes of BMO Capital Markets highlighted in a note that while the points decline was a record, “on a percentage basis, it’s the 28th largest drop since 1947.”
Meanwhile, the S&P 500 lost one per cent to 2,622 points. Yesterday, it lost 4.1 per cent, which was its biggest daily percentage drop since August 2011.
Both the Dow Jones industrial index and the S&P 500 had erased their gains for this year on Monday.
The tech-heavy Nasdaq composite rose 0.1 per cent to 6,978.21. All three benchmark indexes had opened lower.
Shares of tech giant Apple boosted the Nasdaq, raising over one per cent in early trading.
Reitzes said that fundamentals certainly were not driving the “market turmoil.”
“The only data point of the day showed the U.S. non-manufacturing sector started 2018 in robust health,” he said.
“Indeed, while the sharp drop in equities could act as a bit of a headwind for growth, investors should be encouraged by the continued strength in the economic backdrop.”
Canadian shares continued to decline with its longest stretch of losses since January 2016.
In Toronto, the S&P/TSX composite index was lower by 0.7 per cent at 15,222 points — marking its seventh consecutive day of declines.
The market had closed down 1.7 per cent on Monday, hitting its lowest level since mid-September.
Shares of Canada’s big banks led the declines during the market rout with Toronto-Dominion Bank down one per cent, and Royal Bank down 0.9 per cent.
Oil prices also weighed on the index, with benchmark U.S. crude down 1.3 per cent to $63.33 per barrel.
The Canadian dollar was trading at 79.83 cents US, down from Monday’s average price of 80.11 cents.
The greenback was higher against most major global currencies as investors flocked to its safe-haven appeal.
Another safe haven — gold — was up for the fourth day in the last five, to $1,340 US an ounce.
Around the world
Overall, global markets have lost some $4 trillion US as the benchmark MSCI’s 47-country world index fell nearly eight per cent since Friday.
Asia’s biggest market — Japan’s Nikkei 225 Index — lost 4.7 per cent, while Hong Kong’s Hang Seng plunged over five per cent.
Even mainland China’s Shanghai Composite was not immune to the rout after closing higher on Monday. It lost 3.4 per cent.
In Europe, the benchmark Stoxx 600 was down 2.3 per cent after dropping to its lowest level in six months.