TORONTO –

Canada’s main stock index fell nearly 400 points in a third straight day of downward movement amid better-than-expected jobs numbers and expectations of further rate hikes on both sides of the border .

The S&P/TSX composite index ended down 395.88 points or 2.1 percent at 18,583.13.

Colin Cieszynski, chief market strategist at SIA Wealth Management, said markets were hit hard on Friday, particularly in the United States.

In New York, the Dow Jones industrial average was down 630.15 points or 2.1 percent at 29,296.79. The S&P 500 index was down 104.86 points or 2.8 percent at 3,639.66, and the Nasdaq composite was down 420.91 points or 3.8 percent at 10,652.40.

Canada got a bit of a boost from today’s better-than-expected layoffs, as well as the rally in crude oil, Cieszynski said.

Employment in the Canadian economy declined slightly in September, with the unemployment rate falling to 5.2 percent.

U.S. nonfarm payrolls data released Friday also came in better than expected, Cieszynski said.

He said that means central banks do not need to pivot from their quantitative easing paths just yet.

BMO chief economist Douglas Porter said in a note Friday morning that the bank is still forecasting a rate hike of half a percentage point at this month’s Bank of Canada meeting, but said the upcoming Business Outlook Survey and inflation data could to change that.

Of course, analysts are saying that some so-called bad news on employment, inflation or earnings could be good news for the market, as it could be a sign that rate hikes are coming to an end.

But Cieszynski said the good news is still good news — the latest numbers show that central banks managed to deflate the bubble without sending markets into crisis.

“It means the economy is kind of holding up,” he said. “We don’t want everything to turn into a crisis. That would be a disaster for everyone.”

The Canadian dollar traded for 72.93 US cents compared to 72.89 US cents on Thursday.

The November crude contract was up US$4.19 at US$92.64 a barrel and the November natural gas contract was down 22.4 cents at US$6.75 per mmBTU.

The December gold contract was down US$11.50 at US$1,709.30 an ounce and the December copper contract was down almost six cents at US$3.39 a pound.

Cieszynski said he will be watching earnings season in the United States with a keen eye, especially for global companies that could be affected by a rising US dollar.

“We have a general slowdown in the economy, but the biggest problem for Americans is their dollar,” he said.

“The US dollar has just gone up so much against everything that I think it will be a problem for companies in their earnings.”



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