Skip to main content

The Globe and Mail

The close: Dow pares losses, but ends down after ECB inaction

A man looks at the main computer screen at Madrid's bourse Aug. 2.


North American stocks fell on Thursday, reflecting disappointment after the European Central Bank failed to signal that it was ready to buy government bonds – sending Spanish and Italian bond yields soaring.

The Dow Jones industrial average closed at 12,878.88, down 92.18 points or 0.7 per cent – although that marked a 100-point improvement from its low earlier in the day.

The broader S&P 500 closed at 1,365.00, down 10.32 points or 0.8 per cent. In Canada, the S&P/TSX composite index closed at 11,506.50, down 112.03 points or 1 per cent.

Story continues below advertisement

The moves follow the much-anticipated monetary policy statement from the ECB. Last week, the central bank's president appeared to signal that it was gearing up to buy government bonds to drive down borrowing costs in countries like Spain and Italy. However, it failed to take any specific action and said that the ECB could not replace government actions.

The statement sent the yield on Spain's 10-year government bond up 42 basis points, to 7.07 per cent. Similarly, the yield on Italy's 10-year government bond rose 39 points, to 6.3 per cent. There are 100 basis points in a percentage point.

In U.S. economic news, weekly initial jobless claims rose to 365,000, up 8,000 from the previous week, but slightly better than expectations for a bigger increase to 370,000.

U.S. factory orders fell 0.5 per cent in June, dashing expectations for a gain of 0.5 per cent.

Kinross Gold Corp. fell 5.6 per cent after it fired its chief executive, Tye Burt, on Wednesday after markets closed.

Knight Capital Group Inc. slumped 62.8 per cent after the company said that Wednesday's trading glitch would likely cost the company $440-million (U.S.).

Report an error Editorial code of conduct Licensing Options
As of December 20, 2017, we have temporarily removed commenting from our articles. We hope to have this resolved by the end of January 2018. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to If you want to write a letter to the editor, please forward to