Sharp stock market slide as US-China tensions peak

Any short-term market trends are certainly not unexpected after such a painful start to the year. For the year to date, the TSX composite and the Dow Jones industrial average are both down about 1%

Sears Canada announced that it would close all 118 of its remaining stores in January 2018. The news took some of the wind out of HBC’s sails.

Sears Canada has filed for creditor protection, putting 1,500 jobs at risk. The move followed Sears Holdings Corp’s filing for bankruptcy protection. Sears Holdings has 128 stores, down from more than 460 a decade ago.

Market jitters over US-China trade dispute

The US and China released tariffs on $34bn worth of each other’s goods in March. Investors fear a trade war could take a bite out of the world’s largest economies.

In the third quarter of last year, the US accounted for 25% of China’s exports, while China accounted for only 1% of US imports.

Eurasian Natural Resources (ERRC.L) has relied on China for most of its revenue, with 70% of the steelmaker’s output sold into the country. The company, which is involved in the oil and gas sector, also holds significant mineral exploration rights in Siberia.

OPEC member, Norsk Hydro (NHY.OL), is a key supplier of aluminium to China, which accounted for 34% of the shares’ top line in 2017.

Oil futures have fallen 20% in 2018. Last month, OPEC and other oil producers including Russia agreed to reduce oil output in a bid to lift prices.

Industrial metals miner Sherritt International (S.TO) is down nearly 27% so far this year after production was disrupted at its Ambatovy nickel and cobalt joint venture in Madagascar in November.

Sherritt said a fire that destroyed a sulphuric acid plant caused it to miss its 2017 production target by several million pounds.

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