http://www.vancouversun.com/worst+since+black+monday/1016943/story.html

TSX has worst day since Black Monday
Dec 1, 2008

TORONTO — Canada’s top stock exchange fell fast and hard on Monday as investors reacted negatively to news of a brewing coalition government and, more importantly, a steep across-the-board drop in world commodity prices.

Canadian stocks ended the session deeply in negative territory, halting a six-day winning streak for the S&P/TSX composite index. The index plunged 864.41 points, or 9.32 per cent, to 8,406.21, eclipsing the steep fall on Nov. 20 that was the biggest percentage loss since Black Monday in October 1987. Monday’s points loss was the most ever.

TSX Venture exchange fell 27.23 points, or 3.55 per cent, to 739.12. The Canadian dollar closed down 53 basis points to 80.31 cents US.

The backdrop to trading on Monday was confirmation that the federal Liberals and NDP parties have decided to form a coalition government in order to topple the Conservative government.

Morgan Meighen & Associates chief portfolio manager Michael Smedley said investors are no doubt irritated by the prospects of another election, but ultimately he downplayed the effect it had on Monday’s sell-off.

“There is a lot of annoyance and disgust around the political antics in Canada. But on the other hand, it is a market retreat not unlike what we saw elsewhere (Monday), and the fall in commodities is the bigger factor in the downturn here in Canada.”

Taking its toll on energy stocks was crude oil, which fell below $50 US to close at $49.28 US a barrel, down $5.15.

The Organization of Petroleum Exporting Countries deferred a decision to reduce output for another two weeks until its regularly scheduled meeting on Dec. 17. OPEC said it wants more time to assess the impact of a 1.5-million barrel reduction agreed upon in October, but added that it will likely reduce output at the next meeting.

The S&P/TSX energy subindex was down 265.11 points to 2,056.71, with Canadian Natural Resources Ltd. down 14 per cent and Suncor Energy Inc. down 16 per cent.

Mining stocks were roughed up by falling base metals prices, which reacted to deteriorating demand, and gold prices, which fell $42.20 to $776.80 US an ounce. The losing combination sent the materials group down more than 269.33 points to 1,696.97.

Also weighing down the country’s main index were those investors taking profits from the six-day rally that saw the index rise 20 per cent from Nov. 21 through last Friday. The financials group, which jumped 11 per cent, on Friday, fell eight per cent, or 107.04 points, to 1,144.59 on Monday.

“After a good Friday, some investors may have been tempted to believe a reversal had started. That is not the case, and personally, I doubt we’ll see anything better than a bottoming out of the market for some time to come. I’m not optimistic,” Smedley said.

In the U.S., markets were also down substantially as bad economic news mounted. The Dow Jones industrial average dropped 679.95 points, or 7.7 per cent, to 8,149.09. The S&P 500 fell 80.03 points, or 8.93 per cent, to 816.21, while the Nasdaq composite shed 137.5 points, or 8.95 per cent, to 1,398.07.

The National Bureau of Economic Research reported that the U.S. economy has been in a recession since December 2007. Meanwhile, The Institute for Supply Management said manufacturing in the country is contracting at the fastest clip since 1982.



© The Financial Post



This post has been edited by StraightTalk: Dec 1 2008, 03:43 PM

Explain why the Dow Jones plunged 680 points. I don't think the coalition has anything to do with the stock market numbers today more likely the fact that the US was offically called to be in a recession.

http://money.cnn.com/2008/12/01/markets/ma...sion=2008120115

This post has been edited by Nat: Dec 1 2008, 04:14 PM

Obama will eventually raise taxes & make the cost of doing business go up in the US.

There are also Canadian companies listed in the US markets too.

All on top of recession news.

Here's a great reply that I read from someone else:

This amounts to a CONSTITUTIONAL COUP of a democratically elected government. The comparisons to the crisis of 1926, which the current opposition parties claim as precedent is unfounded. In 1926 Canada was still governed by the British North America Act [although I may be wrong on the name], we still flew the British Union Jack as a flag, we didn't have our own national anthem, and we still sang 'God Save the Queen" at any public event. To suggest that after just 7 weeks in office, when parliament has only resumed in the past few weeks, that the opposition has lost confidence in the Conservatives, is nothing more than trying to take away the votes of the Canadian people. The Governor General must allow Canadians to go to the polls again period. If this was any African or third world country and the opposition was trying to change the results of an election weeks ago, the western world would be up in arms at the actions of our opposition parties, particularly with one party of separatists involved in any way shape or form.

I think the market is a racket. It's used by the guys on top to steal from everybody.
I do not believe it necessarily reflects the health of an economy.

It has nothing to do with the coalition.
If that were the case, the Canadian Coalition also drove the market down in the U.S. and Australia.

Shares tumble after Wall St dives
Australian shares have tumbled in early trade, extending yesterday's retreat, after worries about the US economy sparked steep slides on overseas markets.
http
://business.theage.com.au/business/sha...1202-6ozf.html

Yup Australia heard about the Canadian Coalition Party and their Market tanked too, there was an initial surge in their markets because they thought they were getting 'Celine' Dion as the new Prime Minister.

there must of been talk of the coalition govt since september since that is when the stocks started to tank.

Come on they are tanking around the world I don't think our little government has that much power! Attention: REGISTER / LOGIN to view the image!

And with a rermark like that I officially dub you ...."Splat"
Good One, Splat!
twirlyBird

These are wise words!!!!

typical ZERO comment...nothing,zip,nobody home

children children children..the markets are affected by a number of issues..including the loss of a democratic country.

That's funny, you calling anyone a child in your own special, idiotic way.

I think Doc needs a holiday he seems confused today. Attention: REGISTER / LOGIN to view the image!

As the very first line in the story story says:

"Canada’s top stock exchange fell fast and hard on Monday as investors reacted negatively to news of a brewing coalition government AND, MORE IMPORTANTLY, a steep across-the-board drop in world commodity prices."

(emphasis added)

And you don't play the stock market obviously.

Any political uncertainty creates problems for business.

Additionally, the coalition will add an extra $50 billion tax burden on Canadian businesses and that will eat into profit margins -- more layoffs ahead.

And what happens if EI funds dry up?

This post has been edited by StraightTalk: Dec 2 2008, 01:34 PM

Also factor in the new coalitions:

- Carbon Tax
- Cap & Trade

Just extra burdens on business & consumers (on top of higher business taxes).

The stock market is a leading economic indicator.

Wait to see reality sink in with 2009 - 2nd quarter earning reports.

More companies going under, more layofffs, EI drying up, etc.

I hope you all saved up for a rainy day because the storm is coming.

I learned from the Dotcom bust, so my storm gear is ready.

Unfortunately, I am sure many of you will be ill prepared.

This post has been edited by StraightTalk: Dec 2 2008, 02:28 PM

They've already taken the Carbon Tax off the table but will go ahead with Cap & Trade.

Whatever works for them right?

As long as they MAINTAIN THE STATUS QUO of ON & QC, they will be pleased.

Let them keep their cushy jobs -- they definitely will fight tooth & nail for it.

LOL

The Problem With Cap-and-Trade Offsets
Oct 20 2008 10:43AM EDT
http://www.portfolio.com/views/blogs/market-movers/2008/10/20/the-problem-with-cap-and-trade-offsets

EUROPE'S "CAP AND TRADE" PROBLEMS
April 9, 2007
http://www.ncpa.org/sub/dpd/index.php?Article_ID=14411


The best system for the future is promoting new green technology (like hybrid cars, CFL bulbs etc) like CARBON CAPTURE (Conservative's environmental solution).

This post has been edited by StraightTalk: Dec 2 2008, 02:54 PM

News: Apple Mac OS X Code Name Snow Leopard
Mesothelioma Information
Canada Immigration