TSX Plummets 3% On China Worries, Global Sell-off -- Canadian Commentary

(RTTNews) - Canadian stocks plummeted over 3 percent to end lower for a sixth straight session Friday, after global equity markets were trashed under pressure from the sharp sell-off in the Chinese stock market. All sectors ended in the red, driven by weakness in commodity prices as concerns over the global economy continue to plague sentiments.

The sharp decline was led mainly by mining, energy, financial, and material sectors.

China's benchmark Shanghai Composite index plunged 8.49 percent to finish at a five-month low. The hefty plunge came even as Beijing allowed its main state pension fund to invest up to 30 percent of its net assets in domestically-listed shares.

The crisis was set-off earlier this month when China devalued its currency, yuan, by the most in two decades to cushion its exports.

Markets in Europe ended firmly in negative territory at the start of the new trading week, extending the weakness from last week. Concerns over the slowdown in China sparked the largest single session sell-offs in Europe in nearly 7 years.

Markets in the United States under pressure this morning, ended deeply in the red. Following the weak performance of the previous trading week, U.S. equities witnessed a sharp sell-off on continued concerns over China.

Wall Street witnessed a volatile session with the Dow Jones Industrial Average slipping to its biggest loss in 4 years. The Dow shed over 3.5 percent, the S&P 500 fell a near 4 percent, and the Nasdaq was down over 3.8 percent.

The benchmark S&P/TSX Composite Index closed Monday at 13,052.74, down 420.93 points or 3.12 percent. The index scaled an intraday high of 13,396.76 and a low of 12,705.17.

On Friday, the index closed down 263.33 points or 1.92 percent, at 13,473.67, having scaled an intraday high of 13,697.53 and a low of 13,468.72.

Crude oil futures plunged to end at fresh 6-1/2-year lows as global equity markets were caught in a turmoil with a massive sell-off after another collapse in Chinese equities amid mounting concerns over the global economy.

The Energy Index plunged 4.27 percent, with U.S. crude oil futures for October delivery, the most actively traded contract, plummeting $2.21 or 5.5 percent, to settle at $38.24 a barrel on the New York Mercantile Exchange Monday.

Crescent Point Energy Corp. (CPG.TO) shed 5.46 percent, Canadian Natural Resources Limited (CNQ.TO) fell 2.99 percent, and Encana Corp. (ECA.TO) plunged 5.13 percent. Suncor Energy Inc. (SU.TO) fell 3.94 percent.

The Diversified Metals & Mining Index plummeted 5.89 percent, as First Quantum Minerals (FM.TO) plunged 5.15 percent, Teck Resources Limited (TCK-B.TO) plummeted 7.47 percent, Lundin Mining Corp. (LUN.TO) dived 8.96, and HudBay Minerals Inc. (HBM.TO) surrendered 8.00 percent.

Gold futures ended lower, tracking the massive declines in global equity markets, centered on another collapse in Chinese equities and with a bloodbath on Wall Street.

The Gold Index plunged 6.71 percent, with gold for December delivery shedding $6.00 or 0.5 percent, to settle at $1,153.60 an ounce on the New York Mercantile Exchange Monday.

Among gold stocks, Yamana Gold Inc. (YRI.TO) plunged 10.30 percent, Barrick Gold Corp. (ABX.TO) plummeted 8.94 percent, and Kinross Gold Corp. (K.TO) dived 11.03 percent. Goldcorp Inc. (G.TO) dropped 7.94 percent.

Eldorado Gold Corp. (ELD.TO) plummeted 8.04 percent.

The Capped Materials Index plunged 5.42 percent, as Agrium Inc. (AGU.TO) shed 1.87 percent, Agnico Eagle Mines Limited (AEM.TO) plummeted 5.02 percent, and Potash Corp. of Saskatchewan Inc. (POT.TO) surrendered 2.03 percent.

The heavyweight Financial Index dived 2.75 percent, as National Bank of Canada (NA.TO) dropped 1.75 percent, Bank of Montreal (BMO.TO) plunged 4.03 percent, and Royal Bank of Canada (RY.TO) shed 2.87 percent.

Toronto-Dominion Bank (TD.TO) fell 2.51 percent, Bank of Nova Scotia (BNS.TO) fell 2.69 percent, and Canadian Imperial Bank of Commerce (CM.TO) dipped 2.32 percent.

The Capped Health Care Index dropped 1.80 percent as Concordia Healthcare Corp. (CXR.TO) declined 2.68 percent and Extendicare Inc. (EXE.TO) fell 1.80 percent.

Valeant Pharmaceutical International (VRX.TO) dipped 0.21 percent.

The Capped Information Technology Index declined 2.74 percent, as BlackBerry Limited (BB.TO) fell 1.81 percent.

Among other tech stocks, Sierra Wireless (SW.TO) dipped 0.81 percent, Descartes Systems Group (DSG.TO) declined 3.40 percent, and Avigilon Corp. (AVO.TO) plunged 6.14 percent.

The Capped Telecommunication Index plummeted 4.15 percent, as Rogers Communication (RCI-B.TO) dropped 4.37 percent, BCE Inc. (BCE.TO) dived 4.37 percent, TELUS Corp. (T.TO) shed 3.27 percent, and Manitoba Telecom Services Inc. (MBT.TO) surrendered 4.59 percent.

The Capped Industrials Index fell 2.37 percent, even as Bombardier (BBD.B.TO) plummeted 13.18 percent and Finning International Inc. (FTT.TO) shed 1.14 percent.

Canadian Pacific Railway (CP.TO) shed 2.62 percent, while Canadian National Railway (CNR.TO) lost 1.95 percent.

AutoCanada (ACQ.TO) dropped 1.22 percent, after having announced the receipt of approval from General Motors of Canada to acquire an 80 percent non-voting equity interest in the assets of Don Folk Chevrolet.

Baylin Technologies (BYL.TO) dipped 0.66 percent, after Randy Dewey was appointed its new President and Chief Executive Officer, effective immediately.

In economic news, the leading index for Japan, which measures the future economic activity, rose less than initially estimated in June, final figures from the Cabinet Office showed Monday. The index was revised downward to 106.5 in June from a preliminary estimate of 107.2. In May, the score was 106.0. The latest reading is the highest since March 2014, when it marked the same 106.5.

The U.K. economy is expected to grow at a faster pace this year as household spending and productivity growth pick up. The Confederation of British Industry forecast 2.6 percent growth this year, up from the prior estimate of 2.4 percent. Similarly, the outlook for 2016 was raised to 2.8 percent from 2.5 percent.