By Ketki Saxena
Investing.com -- At the close in Toronto, the S&P/TSX Composite Index was at 19,742.56 points, down 2.63% in the day’s trading.
On its fourth day of consecutive losses, the TSX ended sharply lower and in correction territory, down over 10% from its record high ahead of Wednesday's expected interest rate hike from the Federal Reserve as investors worry that central banks will trigger a recession in their efforts to combat inflation.
All TSX sectors were in the red today following broad-based sell-offs, although gains in crude helped the commodity-heavy Canadian Benchmark outperform its U.S. counterparts as the S&P500 slipped into the bear market territory.
Despite a day of volatile trading, crude settled higher at the North American close as tightness in supply outweighed concerns of slowed demand due to slowing economic growth, and renewed lockdowns in China.
Further gains on the index were capped by broad-based losses in metals, also weighed down by the Chinese re-closing and a slide in gold as bond yields and a strengthening dollar lowered the appeal of non-yielding bullion.
Enbridge (TSX:ENB) (-2.48%), Suncor Energy (TSX:SU) (-3.30%), and Baytex (-4.20%) were the most traded stocks on the TSX today. Lifeworks (-2.23%), Ritchie Bros Auctioneers (+1.49%), and Imperial Oil (+1.17%) were the only stocks with gains above 1% on the TSX today, while Lightspeed (TSX:LSPD) (-14.39%), Cannacord Genuity (-11.94%), and OceanaGold (TSX:OGC) (-11.61%) were amongst today’s biggest losers.
In New York the Dow Jones was down 2.79%, the tech-heavy Nasdaq was down 4.68% and the S&P 500 was down 3.88%, officially in bear market territory, or down 20% from its record closing high.
The VIX - Wall Street’s Fear Gauge - spiked 22.59%.
In Bonds and CAD
Bond yields, along with the VIX spiked, and the dollar strengthened as risk aversion dominated markets. Yields on the Canadian 5-year were 0.202 points higher at 3.542%, yields on the 10-year were 0.199 points higher at 3.553%, and yields on the U.S. 10 year were 0.218 points higher at 3.375% - their higher level in over a decade.
Earlier today also saw a brief inversion of the two-year and 10-year Treasury yield curve, which has historically been seen as a reliable indicator for a recession to ollow in one to two years.
The USD index was 0.99% higher at 105.18, while the USD/CAD pair was 0.89% higher at 1.2895