Monthly publication - December 2014 - Difficult year-end for Canadian stock market

Tumbling oil prices caused significant damage to the Canadian stock market in the fall. The energy sector was down 35% from September to mid-October (see graph), while the growing imbalance between oil supply and demand created further pressure on prices. Now that it is clear that OPEC has abandoned, at least for the moment, its role as a buffer
producer (that is, by reducing production in order to shore up prices), it seems that the decline in the price per barrel will not end in 2014. Lower-cost producers Saudi Arabia and the United Arab Emirates are strongly against reducing their production, and blame oil-producing countries outside OPEC, foremost the United States and Russia, as being
responsible for the imbalance. It is therefore reasonable to expect that oil prices will remain low in 2015 and that they may drop further at the start of the year, especially if speculators capitulate. The Canadian stock market thus ended the year poorly, after having outperformed the U.S. market in the first half of 2014. ...   

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