Toronto stock market flat as oil prices rise
The Toronto Stock Exchange.
Published Tuesday, June 26, 2012 5:28PM EDT
TORONTO -- The Toronto stock market inched ahead Tuesday on widespread -- but minimal -- gains across several major sectors as traders held tight to their uneasiness about the global economy.
The S&P/TSX closed the day ahead 4.03 points to 11,334.42, while the TSX Venture Exchange dropped 6.69 points to 1,168.96.
The Canadian dollar was ahead half a cent at 97.66 cents US, as a survey from the Conference Board of Canada showed consumer confidence fell sharply -- by 6.8 points to 74 -- in early June, back to where it was in January.
"It's not surprise that confidence seems to be trending lower," said Paul Vaillancourt, chief investment officer at Canadian Wealth Management.
"It all stems from the pervasive negative moves because of Europe."
Concerns over the ability of Europe's leaders to agree on a package of measures to deal with their debt crisis were of particular focus as Cyprus became the fifth euro country to ask for financial assistance from its partners in the currency zone.
On the upside were information technology stocks which rose 0.7 per cent, despite another drop of two per cent for Research In Motion (TSX:RIM), which fell 19 cents to $9.17.
The telecom sector rose 0.5 per cent as Rogers Communications Inc. (TSX:RCI.B) said it will cut 375 jobs to counter shrinking profits and tougher competition. Its stock was up 33 cents to $36.84.
In commodities, the August crude contract on the New York Mercantile Exchange gained 15 cents to end at US$79.36 a barrel, as the energy sector trekked up 0.3 per cent.
Gold stocks were the biggest decliner, off 2.1 per cent, as August gold closed down $13.50 to US$1,574.90 an ounce. July copper was down less than a cent to US$3.31 a pound.
Metals and mining stocks were off 0.7 per cent while materials stocks were down one per cent.
On Wall Street, traders shifted between gains and losses on the market as they digested data that showed lower consumer confidence in June, the fourth consecutive monthly decline, as lingering worries about the economy outweighed relief at the gas pump.
The Conference Board said its U.S. consumer confidence index stood at 62, down from 64.4 in May and lower than the 63.2 analysts had been expecting. The index remains well below the 90 reading that indicates a healthy economy -- a level it hasn't been near since the recession began in December 2007. But it's far from the all-time low of 25.3 reached in February 2009.
Meanwhile, new data showed home prices rose in nearly all major U.S. cities in April from March, further evidence that the housing market is slowly improving.
The Dow Jones average increased 32.01 points to 12,534.67, the Nasdaq rose 17.90 points to 2,854.06 and the S&P 500 was up 6.27 points to 1,319.99.
European Union leaders meet in Brussels on Thursday for another summit and expectations of a significant change in policy are low even after top European officials, including European Central Bank president Mario Draghi, touted the benefits of jointly-issued eurobonds, which have been backed by France, Spain and Italy, among others.
In a document published on Tuesday, they proposed issuing medium-term debt backed by all countries and a banking union with a single authority that would insure banking deposits and have the power to recapitalize banks directly.
However, Germany remains reluctant to accept the idea of eurobonds or a banking union since such moves would expose it more to the debt risks of weaker countries. Germany also worries that Europe's indebted countries would have less reason to fix their public finances.
In Europe, Britain's FTSE 100 decreased by 0.06 per cent to close at 5,447.42 points. Germany's DAX slid 0.05 per cent to 6,131.86 and France's CAC-40 fell 0.13 per cent to 3,004.72.
Earlier, Asian markets mostly closed lower amid worries over Europe's debt crisis. Japan's Nikkei 225 index fell 0.8 per cent to close at 8,663.99 while South Korea's Kospi was 0.4 per cent lower at 1,817.81. But Hong Kong's Hang Seng rose 0.5 per cent to 18,981.84.
In corporate developments, Rupert Murdoch's News Corp. confirmed it is considering splitting into two publicly traded companies, driving shares to their highest level in 4 1/2 years. Details of the potential division were not disclosed, though a report in the Wall Street Journal said that a split would put the entertainment arm, including the 20th Century Fox film business and the Fox TV networks, into a separate company from News Corp.'s newspaper and book publishing businesses.