The Stock Market At Close – Wednesday, March 15
The Toronto Market:
The TSX today declined -315.32 points, or -1.6% to close the session at 19,378.84. There is something troubling about the TSX being down over 300 points in one market session. It is a rough indication that it is not the “best of times” with the market.
The Energy sector declined -5.7%, as oil prices extended losses with Brent crude hitting a three-month low. The sector posted its worst single-day performance so far this year. The Financials sector followed the global stock market selloff resulting from the turmoil from Credit Suisse, Canada’s largest sector by weight, joined a global selloff in bank stocks, falling 2.2%.
The Banking Sector Problems Persist
Last week it was Silicon Valley Bank (SVB). Today the banking sector turmoil was caused by the problems with Credit Suisse operations. The problems at Credit Suisse are apparently not new. Bloomberg reports the scandals, public legal battles and mounting losses at Credit Suisse Group AG are more striking and hard to comprehend given the Switzerland’s role as banker to the world’s rich. Now the unease about the bank’s mounting problems has snowballed and its shares slumped, forcing management to appeal to Swiss banking authorities for a public vote of confidence.
Global financial stocks slumped today again bringing yesterday’s relief rally to a quick end. The culprit today, was the Credit Suisse’s turmoil. The Swiss lender hit a record low after the firm’s biggest backer said it would not buy any more shares.
In company news, Canadian Pacific Railway Ltd. gained 6.31% or $6.30 to end the session at $106.10 with a volume of 3.7M shares traded. Canadian Natural Resources Ltd. declined -4.72% or -$3.46 to end the market session at $69.77 with a total of 15M shares traded. Bombardier shares continued the down trend. The shares declined 6.05% or -$3.81 to close at $59.21 with a volume of 77K traded today.
The US Market
The Dow Jones declined 280.83 points, or 0.87%, to close at 31,874.57. The S&P 500 declined 27.36 points, or 0.70%, to close at 3,891.93. The Nasdaq Composite edged out a gain of 5.90 points, or 0.05%, to close at 11,434.05.
Most of the eleven major S&P 500 sectors declined, with the energy sector being the worst performer. It declined 5.42%.
Declining issues outnumbered advancing ones on the NYSE by a lopsided 3.34-to-1 ratio and on the Nasdaq by 2.33-to-1 ratio. The S&P 500 posted 3 new 52-week highs and 37 new lows; the Nasdaq Composite recorded 17 new highs and 379 new lows. The market today was lopsided negative.
The SVB and Credit Suisse effects
First Republic Bank tumbled 21.37% while PacWest Bancorp slid 12.87%. Trading was halted several times for volatility. Shares of Western Alliance Bancorp and Bank and Brokerage company, Charles Schwab Corp bucked the trend to close up 8.3% and 5%, respectively. Both stocks reversed early declines.
In company news, the big US banks, JP Morgan Chase (JPM), Wells Fargo (WFC), Bank of America (BAC) and Citigroup (C) stocks, all slightly undercut last week’s lows. WFC stock hit an eight-month low while BAC sank to its worst levels since late 2020.
Credit Suisse Group ADS (CS), during regular market session today declined -13.94% or -$0.35 to close at $2.16 with a volume of 434M shares traded. A few minutes ago, CNN reported that Credit Suisse said it would borrow 50 billion Swiss Francs (US$53.7 billion) from the Swiss National Bank. That decision should affect market reaction to the (CS) stock during the market session tomorrow.
In the technology sector Artificial Intelligence company C3.AI Inc. declined -1.18% or -$0.25 to end the session at $20.85 with a volume of 9.1M traded.
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Stocks In The News/ Stocks To Watch
Microsoft (MSFT), Apple (AAPL), Advanced Micro (AMD), Meta Platforms (META), Salesforce.com (CRM) and Nvidia (NVDA) showed some strength today. Microsoft is one of the few bright spots in the current market. Nvidia has gained a bit this year.
The banks recovered yesterday only to decline even more today. JPM stock fell 4.7%, nearing its 200-day line, setting a 2023 low along with Citigroup. It is possible for the other sectors to gain and keep gaining while the banking sector is literally going through turmoil but it is not likely. The chart below carries one message, “Keep away unless you have limitless risk tolerance”.
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Regular Market Day Features
Beginner Investor’s (Canadian stocks) Watchlist
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The Canadian Vanguard Chinese Stocks Watchlist
EV, Energy and Resource Stocks Watchlist at Today’s Market:
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