TORONTO (CP) — The Toronto stock market closed sharply lower Thursday amid falling commodities prices and another plunge in the shares of Valeant Pharmaceuticals.
Toronto’s S&P/TSX composite index closed down 103.04 points at 13,558.78, its second consecutive day in the red after starting the week on a strongly positive note.
The metals and mining sector of the TSX was the lead decliner, slipping more than four per cent, while global gold declined four per cent.
Meanwhile, shares in Valeant Pharmaceuticals (TSX:VRX) took another big hit Thursday after activist investor Bill Ackman criticized the Quebec drug company’s communication strategy in a letter to its chief executive. The company’s shares plunged more than 14 per cent, or $17.83, closing at $103.37.
In New York, the Dow Jones average of 30 stocks edged 4.15 points lower to 17,863.43, while the broader S&P 500 was off 2.38 points at 2,099.93 and the Nasdaq fell 14.74 points to 5,127.74.
Stephen Lingard, senior vice-president at Franklin Templeton Solutions, said U.S. markets are “treading water” as investors wait to see whether the U.S. Federal Reserve will raise its benchmark interest rate in December.
“October was a great month, and now it’s a consolidation period as we await what the Fed’s going to do next month, because I think that is weighing on investors’ minds,” said Lingard.
“In our view it’s a great thing if they can get rates off zero, because it means the economy, at least in their view, is on a better trajectory.”
Traders also appeared hesitant to make any major moves ahead of Friday’s U.S. government monthly jobs report.
The health of the U.S. employment sector is considered a major factor in the Fed’s decision to pull the trigger on interest rates. The Fed has kept rates at historical lows near zero since 2008, which has helped provide the liquidity that has fuelled stock market growth ever since.
On commodity markets, the December gold contract lost $2 to US$1,104.20 an ounce, while copper shed almost seven cents to US$2.255 a pound.
The December contract for benchmark crude oil slumped $1.12 to US$45.20 a barrel amid recent statements by top officials of the Federal Reserve suggesting a higher likelihood of a rate increase by the U.S. central bank in December.
Oil, like most commodities, is priced in U.S. dollars, and a higher greenback tends to depress prices since that makes commodities more expensive for holders of other currencies.
One commodity moving higher was December natural gas, which shot up 10 cents to US$2.36 per mmBtu after the U.S. Energy Department reported that gas inventories rose less than expected in the week ended Oct. 30.
Meanwhile, the loonie was down 0.07 of a U.S. cent at 75.94 cents.
Transmission utility Hydro One (TSX:H) made its debut on the Toronto Stock Exchange Thursday, closing at $21.62, up 5.46 per cent or $1.12 from its initial offering price of $20.50.
—With files from Brian McKenna
Follow @alexposadzki on Twitter.
Alexandra Posadzki, The Canadian Press
