Stocks Tumble by Noon

Stocks in Canada’s biggest centre fell on Wednesday after data showed the domestic economy shrank a record 9% in March from February and as the central bank warned the coronavirus outbreak was set to trigger the biggest near-term economic downturn.

The S&P/TSX Composite Index dumped 266.33 points, or 1.9%, to kick off Wednesday at 13,992.10

The Canadian dollar dropped 0.96 cents to 71.06 cents U.S.

The largest percentage gainers on the TSX were shares of Aphria, which jumped 17 cents, or 4.7%, to $3.81, after third quarter results showed company posted a profit compared to a year ago loss.

Vermilion Energy fell $1.04, or 17.5%, the most on the TSX, to $4.92, followed by shares of Secure Energy Services, down 20 cents, or 14.9%, to $1.11.

Economically speaking, Statistics Canada, in a flash estimate, said the coronavirus outbreak forced a shutdown of economic activity resulting in a monthly decline in gross domestic product (GDP) which would be the most since the series started in 1961.

Elsewhere, the Canadian Real Estate Association reported that home sales recorded over Canadian MLS Systems dropped by 14.3% in March compared to February, as the economic turmoil and physical distancing rules surrounding the COVID-19 pandemic caused both buyers and sellers to increasingly retreat to the sidelines over the second half of the month.

The Bank of Canada today maintained its target for the overnight rate at 0.25%, which the Bank considers its effective lower bound. The Bank Rate is correspondingly 0.5% and the deposit rate is 0.25%. The Bank also announced new measures to provide additional support to Canada’s financial system.

ON BAYSTREET

The TSX Venture Exchange dipped 5.51 points, or 1.2%, to 439.74

All but two of the 12 TSX subgroups moved backward, as energy fell 7.3%, financials ditched 3.2%, and real-estate issues slid 2.6%

The two gainers proved to be consumer staples, ahead 0.6%, and information technology, up 0.1%.

ON WALLSTREET

Stocks fell sharply on Wednesday as dismal economic data and weak bank earnings fueled concerns over the coronavirus’s impact on the U.S. economy.

The Dow Jones Industrial tumbled 668.52 points, or 2.8%, to 23,281.24.

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The S&P 500 sank 78.58 points, or 2.8%, to 2,767.48,

The NASDAQ Composite went south 161.54 points, or 1.9%, to 8,354.20.

Bank of America traded more than 5% lower on the back of disappointing earnings. Citigroup fell more than 4%. Energy and financials were the worst-performing sectors in the S&P 500, dropping more than 4% each.

Retail sales during the month of March plunged a record 8.7%, according to a report from the Commerce Department published Wednesday. That was the largest one-month decline since the department began tracking the series in 1992.

Grocery stores, pharmacies and other retailers of essential goods saw a surge in demand last month amid the outbreak, the government said. But sales at a variety of other businesses — such as gas stations, auto dealerships, and restaurants — swooned as state governments shuttered commerce in an effort to slow the virus.

Bank of America said its first-quarter profit fell 45% as its loan-loss reserves grew by $3.6 billion because of the coronavirus outbreak. Goldman Sachs shares dipped more than 3% after the bank reported a 46% decline in first-quarter profit as the coronavirus whacked performance in its asset-management division.

Citigroup, too, said it saw first-quarter income slide 46% as it set more funds aside to protect itself from potential missed payments from borrowers and other loan holders.

President Donald Trump said Tuesday that he believes some states will be able to lift the strict social distancing measures that have strained their economies before the end of April.

Prices for the 10-Year U.S. Treasury vaulted, lowering yields to 0.64% from Tuesday’s 0.75%. Treasury prices and yields move in opposite directions.

Oil prices skidded 60 cents to $19.51 U.S. a barrel.

Gold prices retreated $25.50 to $1,743.40 U.S. an ounce.