Canadian dollar at 76 cents, crude down 2.5%
GDP numbers out of China confirm slowdown that pushes oil and other commodities lower
The Canadian dollar was down two-thirds of a cent Monday as commodities prices fell and investors awaited the results of a federal election.
The loonie was trading at 76.80 cents US at the close, off by 0.6 of a cent.
That followed a 2.5 per cent drop in the price of crude and falling copper, nickel and gold prices.
- China economic growth lowest in over 6 years
- Valeant CEO says drug price increases will be modest in 2016
Commodity prices are falling in response to data on the Chinese economy that shows it growing at 6.9 per cent in the third quarter, its slowest pace in six years.
A slowdown in China could lead to reduced demand for raw materials, including the metal and minerals and lumber shipped from Canada.
West Texas Intermediate, the benchmark North American crude contract, was down 2.5 per cent to $46.08 US a barrel. WTI has been trading in the $46 to $47 range for most of the past month, but fears of continued international oversupply of oil have prevented it moving above $50.
Oil storage depots in the United States are at record levels and now refineries are slowing production for maintenance. The refining profit for gasoline crack is down five per cent as the price of gasoline falls in the U.S.
The U.S. dollar is strengthening after a downturn last week, and that has pushed down the loonie while making commodities priced in the American currency more expensive elsewhere.
Falling energy stocks and the decline of pharmaceutical company Valeant, which reported earnings today, helped pull down Toronto stocks. Valeant shares fell by six per cent despite a rise in earnings after it predicted lower price increases for drugs in the coming year.
The TSX closed down 79 points at 13,758, despite stock market rallies in China, Europe and New York on Monday.
Investors are being cautious in advance of a federal election that could reset the political landscape overnight.