North American stock markets plunged at the start of trading today as COVID-19 fears tightened their grip on investors.
The crash came despite the U.S. Federal Reserve’s weekend to cut its key interest rate in a bid to limit the economic damage as businesses closed their doors and people stopped travelling in an effort to slow the spread of the virus.
The initial decline on North American stock markets triggered circuit breakers in Canada and U.S. that forced a brief pause trading.
In later morning trading, the Toronto S&P/TSX composite index was down 1,404.58 points at 12,311.75 — up from the day’s low.
In New York, the Dow Jones industrial average was down 2,298.31 points at 20,887.31. The S&P 500 index was down 261.73 points at 2,449.29, while the Nasdaq composite was down 737.96 points at 7,136.92.
The Canadian dollar traded for 71.62 cents US compared with an average of 71.94 cents US on Friday.
The drop in North American stock markets came after markets in Asia and Europe also fell.
The U.S. Federal Reserve cut its short-term interest rates back to their record low of nearly zero on the weekend and also said it will buy at least $500 billion of Treasury securities and $200 billion of mortgage-backed securities to help calm the Treasury market.
The Bank of Canada, which also moved on the weekend to help ensure global U.S. dollar liquidity, cut its key interest rate by half a percentage point on Friday to 0.75 per cent and said it was ready to make further changes if required to support economic growth and keep inflation on target.
The April crude contract was down US$2.47 at US$ 29.26 per barrel and the April natural gas contract was down 6.2 cents at US$1.807 per mmBTU.
The April gold contract was down US$45.3 at US$1,471.40 an ounce and the May copper contract was down 10.45 cents at US$ 2.3595 a pound.
The Canadian Press