Trading on the Toronto Stock Exchange was light and its main stock index opened lower Monday following the shutdown of U.S. markets due to the onset of Hurricane Sandy on the Eastern Seabord.
U.S. markets were to remain closed for a second day Tuesday.
Bob McDonald, senior managing director and co-head of institutional trading at Raymond James Ltd. said trading activity in Toronto was “extremely light" on Monday, as expected.”
“Whenever New York is closed, one thing you can bet on is that Toronto – broadly speaking– will tread water,” said Ross Healy, head of Strategic Analysis Corp. in Toronto.
“Having said that, it certainly will continue to react to important news. We shouldn’t assume it will be quiescent.”
The number of shares changing hands at midday reached only 82 million – with a total value of $1.2-billion – compared with a daily 2012 average of 337.2 million worth $4.9-billion. The S&P/TSX was down 25.28, or 0.21 per cent, at 12,275.02.
U.S. regulators and exchanges agreed on Sunday it would be best to temporarily suspend all trading, including electronic transactions. The initial strategy was to close floor trading but keep electronic trading open, but that proposed move sparked complaints from customers who said a partial close would be too complicated, according to reports.
The shutdown is the first emergency, across-the-board closing since September, 2001. By noon Monday, officials said markets would remain closed a second day due to the storm.
Some U.S. electronic trading firms were instructing those employees with electricity to set up makeshift offices at home to deal with client inquiries.
This is the first time U.S. markets are forced to close because of a weather-related event since Hurricane Gloria hit on Sept. 27, 1985.
Some forecasters said the storm – bringing coastal flooding, fierce winds and heavy rain – might turn out to be the biggest-ever to hit the U.S. mainland.
Mass transit in New York city was halted and thousands of flights scrubbed as New York airports closed.
Sandbags and concrete barricades were set up at some lower Manhattan banks and brokerages. Many office buildings in lower Manhattan’s Financial District are located in evacuation zones.
Financial firms put in place emergency plans, including shutting some offices in range of the storm’s impact.
Several publicly listed companies, including pharmaceutical giant Pfizer Inc. and power firm Entergy Corp. – postponed their earnings releases, with others expected to do the same.
Other companies that have decided to hold off on reporting their quarterly earnings – initially scheduled for Monday or Tuesday - until later in the week are Thomson Reuters Corp., Avon Products Inc. and Martha Stewart Living Omnimedia Inc.
Some companies have decided to go ahead with their earnings releases as planned: Burger King Worldwide Inc., Valero Energy Corp. and Master Card Inc.
Among U.S. markets cancelling operations are NYSE Euronext’s New York Stock Exchange, Nasdaq and New York Mercantile Exchange.
The Boston Options Exchange (BOX), in which TMX Group owns a majority interest, said it will be closed Monday.
“This was a co-ordinated decision made with input from the [U.S. Securities and Exchange Commission], other exchanges, various participants, and [Securities Industry and Financial Markets Association] in the interest of public safety and maintaining fair and orderly markets,” BOX said in a news release.
U.S. bond markets will be closed on Tuesday, the U.S. Securities Industry and Financial Markets Association said in a news release Monday morning.
SIMFA had recommended an early close of noon EST on Monday for the trading of fixed-income securities.
Meanwhile, Hurricane Sandy could complicate Friday's release of the October U.S. jobs report, the final snapshot of employment before the presidential election.
U.S. Labour Department officials are still hopeful that they can release the report as scheduled. But they acknowledged that the storm could cause a delay.
“Our intention is that Friday will be business as usual regarding the October employment ... report,” says Jennifer Kaplan, a department spokeswoman.
Preparation for the jobs report typically ramps up in the week of the release. The federal government was closed Monday. Final calculations could be delayed if the government stays closed because of the storm.
Tom Nardone, who oversees the preparation of the report, said some advance work was done Friday and some employees were able to work on the report Monday.
With files from The Associated Press