TMCnet News
Commodities lead stocks lower despite earnings from Microsoft, Amazon; oil falls(Canadian Press DataFile Via Acquire Media NewsEdge) TORONTO _ The Toronto stock market finished sharply lower Friday in a broad-based decline involving all sectors and led by falling tech and energy shares. The S&P/TSX composite index dropped 151.24 points to 11,382.13, losing 122.63 points or 1.06 per cent this week, while the TSX Venture Exchange added 0.28 of a point to 1,333.91. There was no particular reason for the negative investor sentiment, which also drove New York indexes lower; investors took in solid earnings reports from Microsoft Corp. and Amazon.com. Linda Duessel, equity market strategist at Federated Investors in New York, didn't see a cause for worry in the downturn, saying the market needed to pause after the massive surge it has made since early March. The S&P/TSX composite index is up about 50 per cent while the S&P 500 index is up about 60 per cent from the lows of early March. ``The run-up has been too fast,'' she said. ``You need to consolidate.'' The Canadian dollar was down 0.37 of a cent to 95.07 cents US, a day after Bank of Canada governor Mark Carney said the sharply higher currency is putting a brake on the country's economy recovery. And he made it clear that ''intervention is always an option'' to control the rise of the loonie, which came within about 2.5 cents of regaining parity with the U.S. dollar a week ago. The TSX energy sector slipped two per cent as the December crude contract on the New York Mercantile Exchange fell 69 cents to US$80.50 a barrel. Crude prices had shot up more than three per cent earlier this week to a one-year high on optimism an economic recovery is taking root. EnCana Corp. (TSX:ECA) lost $1.77 to $63.10. TSX mining stocks were down slightly as the December copper contract in New York rose 3.6 cents to US$3.03 a pound while December bullion was off $2.20 at US$1,056.40 an ounce. The financial sector gave back 1.23 per cent with Bank of Montreal (TSX:BMO) down $1.01 to $52.03. The tech sector fell 1.89 per cent, with market heavyweight Research In Motion Ltd. (TSX:RIM) down $1.63 to $69.20. Shares in electronics manufacturer Celestica Inc. (TSX:CLS) fell 69 cents to $8.96 as the firm generated a small third-quarter loss, reversing a year-earlier profit, as revenues took a hit from the recession and the company booked higher restructuring costs from earlier job cuts. The tech sector was also weak in New York as Amazon jumped $25.04 or 26.8 per cent, to $118.49 after its third-quarter earnings jumped 68 per cent and the online retailer forecast more than 20 per cent growth for the current quarter. Microsoft's earnings fell 18 per cent largely because it deferred revenue when it let buyers of PC's over the summer get free upgrades to Windows 7, which the company released this week. Earnings would have risen otherwise and the company continued to cut costs. The stock rose $1.43 or 5.38 per cent, to $28.02. The tech laden Nasdaq ended the session down 10.82 points to 2,154.47. The Dow Jones industrial average fell 109.13 points to 9,972.18 for a loss of 23.73 points this week. The S&P 500 index gave back 13.31 points to 1,079.6. Cautious comments from the leaders of major U.S. railway companies were a cause for worry. Union Pacific chairman and CEO Jim Young said Thursday that he expects the economy to ``limp along'' until unemployment starts to fall. Burlington Northern also issued a tepid forecast after the end of trading Thursday. Union Pacific said its profit was off 26 per cent, while revenue fell 24 per cent. Burlington reported a 30 per cent drop in third-quarter earnings, while revenue fell 27 per cent. Earlier this week, Canadian National Railway (TSX:CNR) reported a 13 per cent drop in third-quarter profit. Its shares were down $1.15 to $53 and contributed to a drop of 1.28 per cent in the TSX industrials sector. Investors were seemingly unaffected by data showing that U.S. home resales rose far more than expected last month to the highest level in more than two years as buyers scrambled to complete their purchases before a tax credit for first-time owners expires. The National Association of Realtors says sales rose 9.4 per cent to a seasonally adjusted annual rate of 5.57 million in September, far above the annual pace of 5.35 million that economists expected. Other earnings reports included an advance warning from fertilizer company Agrium Inc. (TSX:AGU), which said it expected third-quarter earnings to be 90 to 95 per cent below what they were a year ago when the full report is issued on Nov. 4. Agrium attributes the decline to lower prices and margins for all three categories of fertilizer that it produces and its shares fell $4.21 or 7.05 per cent to $55.52. Shaw Communications Inc. (TSX:SJR.B) shares lost 62 cents to $19.95 as it said net income was $124 million or 29 cents a share for the three months ended Aug. 31, down 6.3 per cent from $132.3 million or 31 cents a share in the year-ago period. Annual net income was $535.2 million, down 20.3 per cent from $671.6 million in fiscal 2008. (c) 2009 The Canadian Press |