TMCnet News
Markets trashed at open(Baystreet Stock Market Update (Canada) Via Acquire Media NewsEdge) Jobs figure trump experts The Toronto stock market headed for a weak open Friday as commodity prices fell back despite indications that the Chinese economy, a huge consumer of oil and metals, may not be slowing as quickly as thought. The S&P/TSX Composite Index unloaded 143.10 points, or 1.1%, to begin the final session of a turbulent week at 13,112.64 The Canadian dollar shed 0.44 cents to 102.35 cents U.S. A string of losses has left the TSX about 1,000 points below its highs for the year and about 200 points below where it started 2011. China's imports rose 28.4% over a year ago during May, up from April's 21.8% growth rate and beating most forecasts, data showed Friday. Export growth eased to 19.4% from April's 29.9% amid slower global demand. The Chinese government has been moving to cool its economy in order to bring down high inflation, particularly rising food costs, through higher interest rates and higher reserve requirements for banks. In earnings news, retailer Lululemon Athletica Inc. rose above analyst expectations in the first quarter with a bigger profit on the back of stronger sales of its yoga apparel. Earnings came in at $33.5 million, or 46 cents per share in the quarter, above predictions of 38 cents per share, according to a poll by Thomson Reuters, and also ahead of the $19.6 million in profit reported a year ago. Revenue increased to $186.8 million from $138.3 million. Research In Motion said Friday it will launch its PlayBook tablet device in another 16 international markets over the next 30 days, including India, the U.K. and Australia. Patheon Inc., a provider of contract drug manufacturing services, reported it lost $11.2 million U.S. in the second quarter, reversing a $10.9-million profit a year earlier. The company, which reports in U.S. currency, said weakness in the U.S. dollar resulted in an $8.8 million currency translation hit on its books. Revenues for the quarter fell 3.1% to $170 million. On the economic front, Statistics Canada reported this morning that 22,300 new jobs were created last month, slightly above consensus following the previous month's strong 58,000 gain. The unemployment rate fell 0.2 percentage points to 7.4% ON BAYSTREET The TSX Venture Exchange dropped 10.63 points to 1,947.94 while the Nasdaq Canada index slipped 8.27 points to 597.98 In Toronto, all 14 subgroups went south soon after the opening bell. Gold tailed off 1.8%, while the metals and mining group co-vied with its brethren among global base metals, falling 1.7% each. ON WALLSTREET In New York, stocks were set to open slightly lower Friday, as investors remain nervous about the slowing economic recovery. The Dow Jones Industrial Average jettisoned 115.95 points, or 1%, to 12,008.40 The much-broader S&P 500 gave back 12.08 points to 1,276.92, while the tech-heavy Nasdaq Composite Index fell 20.40 points to 2,664.47 On Thursday stocks snapped a six-day losing streak, with all three major market gauges ending the session higher. Despite the rebound Thursday, market sentiment is still pessimistic. The Dow and S&P 500 are on pace to post their sixth-consecutive weekly loss. The selling has been driven by concerns about the economy, following a series of weak reports on the job market, housing and manufacturing activity. With no top-tier economic reports on the agenda Friday, one expert said he expects trading to be choppy as the market tests recent lows. He added the S&P 500 could slip to the 1,275 level before finding some support. The broad stock index closed at 1,289 on Thursday. Toyota released its forecast for the fiscal year 2012 Friday morning. The auto giant said the fallout from the March earthquake and tsunami will continue to hurt sales, and cause supply disruptions across the industry. In its report, Toyota said it could lose $1.6 billion U.S. in profits in the current fiscal year. The automaker said it also expects consolidated net income to drop 31% to $3.4 billion U.S. in the next fiscal year ending March 31. Toyota also forecast operating income to drop about 35% for the next business year, based on current exchange rates between the yen and the U.S. dollar. Lululemon Athletica's stock jumped nearly 3% after the maker of athletic clothing reported a profit that topped estimates and raised its outlook. Shares of Fusion-io extended their rally, rising 4% in premarket trading. Fusion-io made its public debut Thursday after raising $233.7 million U.S. through an initial public offering. Online music streaming company Pandora said it would sell a total of 14.7 million shares through its previously announced IPO at a price range of $10-$12 U.S. a share. Avaya, which makes telecom equipment, filed Thursday to raise up to $1 billion U.S. in a public offering. The company joins a crowd of tech companies rushing to take advantage of a suddenly friendly IPO climate. Ally Financial, formerly the financial services arm of GM, has decided to delay its $5 billion initial public offering, according to reports. The company has been owned by U.S. taxpayers since GM was rescued by the government in the recession. Comcast and Micron Technology stocks were also on the move early Friday. Economically speaking, the U.S. government reported import prices for May rose 0.4%, excluding oil. That comes after a 0.6% increase in the prior month. Excluding agriculture, exports increased by 0.5%. That followed a 1.0% increase in April. Also on tap, the federal budget deficit for May is slated to be announced at 2 p.m. ET. The price on the benchmark 10-year U.S. Treasury jumped, with yields stumbling to 2.95% from 3% late Thursday. Treasury prices and yields move in opposite directions. Oil prices teetered $2.02 to trade at $99.91 U.S. a barrel. Gold futures for August delivery slipped $1.40 to $1,540.70 U.S. an ounce. © 1998 - 2011 Baystreet.ca Media Corp. All rights reserved. |