Canadian Stocks Start New Year with a Whimper
Major Canadian indexes started the New Year with a big flop as fears of slowing economy, worries Fed might be behind the curve and more bad new from the high tech sector combined into a potent bad brew. The TSE 300 fell 322.18 to 8611.50, hit hard by weakness in Industrial Products, Utilities, and Financial Services. Oil & Gas fell despite Saudi talk of output cuts. Breadth was 668-662 positive. Government of Canada bonds ended higher, helped by hopes Fed will ease soon, perhaps before its January 31 meeting. Market participants are focusing on this Friday's jobs report, which is said to be a Greenspan favorite.
European stock markets closed the first session of the New Year solidly lower. In London, the Financial Times-Stock Exchange 100 index, which fell 1 point Friday, finished Tuesday's session with a loss of 47.80 points (-0.77%) to close at 6174.70. Banks and techs led the decline. The British 10-year bond yield fell 9.7 basis points to 4.785% as money shifted away from stocks and into fixed income in anticipation of easier monetary policy from the U.S.
In Germany, the DAX index, meanwhile, was off 120.07 points, or 1.87%, to 6,313.54 as the German Purchasing Managers Index fell to 54.0 in December from 55.4 in November. France's CAC 40 was down 127.52 points, or 2.15%, at 5,798.90 as French PMI fell to 52.8 in December from 54.1 in November.
Markets in Japan were closed in observance of holidays. Hong Kong's Hang Seng index, meanwhile, ended off 225.59 points, or 1.49%, at 14,869.94.