It’s been a turbulent week for North American markets, which were battered last Friday as concerns mounted over the emergence of the latest Covid variant, Omicron.
In Monday trading, Canadian and U.S. stocks closed higher, regaining some of the ground lost in Friday’s sell-off, as sentiment turned positive after U.S. President Biden urged calm as the scientific community continues to assess the variant’s threat.
However, North American stocks and global oil prices registered their second significant declines in three sessions on Tuesday, as concerns once again mounted about the economic impact of a new Covid-19 variant. Brent crude was hit especially hard, falling nearly 4%. That was bad news for the TSX, which lost nearly 500 points, or 2.3%. In the U.S., the Dow and S&P 500 shed roughly 2%, while the Nasdaq declined 1.5%. Losses intensified Tuesday after Fed Chair Jerome Powell said the central bank would consider concluding its tapering process sooner, in an effort to battle rising inflation.
In economic news, Statistics Canada reported Tuesday that the Canadian economy rebounded in Q3 — after a surprise contraction in Q2 — as GDP increased at a 5.4% annualized rate. Rising consumer spending helped drive the overall increase, with households spending more on semi-durable goods, like clothing, as well as services.
North American markets fell once again in a volatile trading session Wednesday. Although U.S. stocks initially rallied, markets surrendered ground after reports that new Covid-19 infections nearly doubled in South Africa Wednesday and that the Omicron variant had been identified in California. By Wednesday’s close, the Dow lost 462 points, erasing an intraday gain of more than 500 points. Meanwhile, the S&P 500 fell 54 points, the Nasdaq dropped 284 and the TSX shed 195.
It was a bounce-back day for markets Thursday as investors waded back in to stage a broad-based rally. The Dow jumped 618 points, while the S&P 500 and Nasdaq added 64 and 127 points, respectively. In Canada, the TSX surged nearly 300 points.
Finally, initial U.S. jobless claims came in at 222,000, an increase from the previous week but lower than initial expectations.
North American Markets Slip
For the four trading days covered in this report, the Dow dropped 259 points to close at 34,640, the S&P 500 fell 17 points to settle at 4,577, while the tech-heavy Nasdaq lost 110 points to close at 15,381. In Canada, the TSX declined 364 points to end at 20,762.
Dri Financial Group 