Toronto stocks dive to lowest level since April

The Toronto stock market racked up a triple-digit slide for the third time this week, closing at its lowest level since April.

The S&P/TSX composite index fell 233.24 points or 1.6 per cent to 14,227.36, amid worries about the global economy and lower oil prices.

• Oil price at $85 costing provinces and economy billions

The Canadian dollar lost 0.35 of a cent to 89.15 cents US as the American currency got stronger.

It was a subdued end to a wild week on markets, as stocks in both New York and Toronto seesawed on speculation about interest rates and data giving an uneven view of the economy.

The Dow had its biggest decline of the year on Thursday, one day after its biggest gain of the year.

The Nasdaq plunged 102.1 points to 4,276.24, while the S&P 500 index was down 22.08 point to 1,906.13.

The TSX is down seven per cent from its high in September, the Dow down about 3.3 per cent and the S&P 500 down 4.5 per cent.

But the key worry for traders was the outlook for global growth, which was downgraded by the International Monetary Fund earlier this week.

Jobs news discounted

Canada had good news on jobs this morning, with Statistics Canada reporting a drop in unemployment to 6.8 per cent, a six-year low. 

But traders ignored the job numbers in the face of bad news out of Germany, where exports fell by the largest amount in five years. Germany is considered the economic engine of Europe and there are worries that the eurozone will fall into recession if its output slows.

Douglas Porter, chief economist at BMO Financial Group, sees a series of economic developments working against market stability.

"We’ve been hit by a few things. First of all, we’ve had some pretty serious sanctions on Russia and Russia is now in recession and Germany was a big supplier to Russia," he said in an interview with CBC's The Exchange with Amanda Lang.

"But I think Germany’s being hit by a bit of a crimp in emerging markets as well. Germany really relies on those exports to places like China," he said.

Banks, energy stocks lower

Porter said traders might have discounted the job numbers because they are a measure taken in September, predating the current mayhem in markets.

"What I found very interesting was we had a very strong job number out of the U.S. last week and it had a very small impact before disappearing under the waves, just because of all these concerns around the U.S. and Europe," he added. 

There was a one per cent drop in the financials index over worries about interest rates, which could begin rising again in 2015. Canadian rail stocks were also lower.

Energy stocks in the U.S. were hurt by the falling price of oil.

Electric car maker Tesla fell seven per cent in early trading as traders seemed disappointed by the company's announcement of a new all-wheel-drive car late Thursday.

Semiconductor stocks were sharply lower after Microchip Technology cut its sales forecast for the quarter and warned investors to expect bad news from others in the sector. Its stock was down 12 per cent.