Stock markets start year on shaky ground after big losses in 2018 - Action News
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Stock markets start year on shaky ground after big losses in 2018

North American stocks edged higher on the first trading day of the new year, recovering from earlier losses, after December's market rout left investors nervous.

Weak manufacturing data from China continues to fuel concerns over global growth

U.S. equities had their worst performance in a decade last year. (Richard Drew/Associated Press)

North American stocks edgedhigheron the first trading day of the new year, recovering from earlier losses, after December's market rout left investors nervous.

Weak manufacturing data from China on Wednesdaycontinued to fuel concerns about slowing demand from the world's second largest economy, which could lead to slowing global growth.

The Caixin/Markit manufacturing purchasing managers' index (PMI) for December showed the country's manufacturing sector shrank for the first time in 19 months.

"We think that growth in the U.S.and Chinese economies will slow in 2019, and by more than investors are discounting, causing equity prices to fall in both cases," said Oliver Jones, markets economist at Capital Economics, in a report.

In Canada, the S&P/TSX composite index recovered from earlier losses in the dayto closeup 0.2per cent to14,347.16points.The benchmark index lost 12 per cent last year, with a swift downturn inthe last three monthsof 2018, following the global trend.

Commodities lead gains

Health-care stocks led the gains on Wednesday, with shares of marijuanaproducers Canopy Growth andCronosGroup bothup more than sevenper cent.

The energy sector was also higher as oil prices rallied on news that Saudi Arabia was following through with a pledge to cut exports in order to ease the global supply glut.

The price for the benchmark U.S. oil contract West Texas Intermediate was up2.7per cent in New York to $46.61US. It had risen more than four per cent at one point.

The Canadian dollar rose with the oil prices, trading at an average of73.53cents US, compared with an average of 73.30 cents US on Monday.

In other commodities, the price of gold jumped as investors fled to safe havens amid worries about global growth. Gold hit a six-month high, near $1,300 US an ounce after the Chinese manufacturing data came out.

Markets in the U.S. reversed earlierlossesin the afternoon to all closehigher.The tech-heavyNasdaqcomposite led the gains in New York andwas upby 0.5per centto6,665.94points.

But, shares of Tesla plunged nearly seven per cent on the Nasdaqafter the electric automakercut vehicle prices by $2,000 US, and its fourth quarter sales figures fell below expectations.

Meanwhile, the Dow Jones Industrial Average rose0.1per cent to 23,346.24, while the broader S&P 500 gained 0.1per cent to2,510.03points.

U.S. equities marked their worst performance in a decade last year.

Investors in the U.S. and Canada are alsolooking ahead to employment datafor December on Friday for signs on how the economies ended the year.

With files from The Associated Press