Toronto stock market flat despite positive U.S. data
FILE - Federal Reserve Chairman Ben Bernanke testifies on Capitol Hill in Washington, before the Senate Banking Committee on Feb. 17, 2011. (AP / J. Scott Applewhite)
Published Wednesday, August 15, 2012 8:22AM EDT
Last Updated Wednesday, August 15, 2012 10:30AM EDT
TORONTO -- The Toronto stock market was flat Wednesday amid lower oil prices and positive U.S. economic data.
The S&P/TSX composite index gained 6.75 points to 11,860.36 while the TSX Venture Exchange added 4.7 points to 1,201.7.
The Canadian dollar was up 0.09 of a cent to a 3 1/2-month high of 100.97 cents US.
New York markets were positive as traders looked to U.S. data showing weak pricing pressure and a solid reading on industrial production.
The Dow Jones industrials was 0.54 of a point higher to 13,172.68, the Nasdaq composite index was up 5.51 points to 3,022.49 and the S&P 500 index rose 1.14 points to 1,405.07.
Inflation remains tame as the consumer price index was unchanged in July for the third time in four months. Economists had expected the CPI to rise 0.2 per cent.
And industrial production climbed 0.6 per cent in July on top of a 0.4 per cent gain in June and better than the 0.5 per cent reading that economists had forecast.
The telecom sector led advances, up 0.26 per cent with Telus Corp. (TSX:T) ahead 42 cents to $65.02.
Industrials were also positive as Canadian Pacific Railway (TSX:CP) gained 45 cents to $84.10.
The base metals sector was slightly higher after a three per cent loss on Tuesday as the September copper contract on the Nymex was unchanged at US$3.36 a pound. Metal prices have weakened in the wake of data released over the past few days which showed slowing Chinese export growth and a sharp drop in economic growth in Japan during the second quarter.
First Quantum Minerals (TSX:FM) gained seven cents to C$19.10.
The energy component was off 0.18 per cent as oil prices slipped while demand worries increased amid an unexpected increase in oil supplies in the U.S.
The September contract on the New York Mercantile Exchange lost 43 cents to US$93 a barrel after the American Petroleum Institute said crude stockpiles in the U.S. rose some 2.8 million barrels last week. Expectations were for a drop of 1.7 million.
Canadian Natural Resources (TSX:CNQ) dipped six cents to C$30.60.
The gold sector was flat and bullion prices higher with the December contract ahead $2.10 to US$1,604.50 an ounce. Barrick Gold (TSX:ABX) added nine cents to C$33.97.
Markets have rallied sharply since the beginning of June when the worsening European debt crisis started to squeeze Spain and Italy and raised worries about the viability of the global economic recovery.
But the TSX has risen about five per cent from those lows, in part because of hopes pinned on central banks to keep the rebound on track and take steps to ensure the survival of the European monetary union.
At the same time, a round of upbeat U.S. economic figures -- including the industrial production data and a strong July retail sales report Tuesday -- have reined in expectations of the Federal Reserve doing something in September. However, investors may not get a clearer insight into Fed policy until chairman Ben Bernanke's speech on Aug. 31 at an annual economic conference in Jackson Hole, Wyoming. Until then, markets may drift in the traditional summer lull in Europe and the U.S.
Traders are also looking to the European Central Bank and the monetary authorities to announce new policy measures in the coming weeks. While the ECB is expected to restart its bond-buying program in order to keep a lid on the borrowing rates of Italy and Spain, the People's Bank of China is widely-tipped to cut interest rates further to shore up faltering economic growth.
European bourses were mixed with London's FTSE 100 index down 0.18 per cent, Frankfurt's DAX declined 0.07 per cent while the Paris CAC 40 rose 0.17 per cent.
Earlier in Asia, stock markets finished mostly lower. Japan's Nikkei 225 index closed slightly down while Hong Kong's Hang Seng fell 1.2 per cent. Markets in South Korea and India were closed for public holidays.
Benchmarks in mainland China also fell. The Shanghai Composite Index lost 1.1 per cent while the smaller Shenzhen Composite Index lost 0.8 per cent.
In corporate developments, Sears Canada Inc. (TSX: SCC) reported a quarterly net loss of $9.8 million or 10 cents per share, compared with a net loss of $200,000 or less than a penny per share in the similar 2011 period. Revenue fell to $1.05 billion from $1.15 billion. Its shares dipped one cent to $10.34.
Agriculture equipment maker Deere said its third-quarter net income rose 11 per cent to $788 million, or $1.98 per share but fell well short of expectations of $2.31 a share as the company was hit hard by a weakening global economy and prolonged drought in the U.S.
Deere's revenue rose 15 per cent to $9.59 billion, missing expectations of $9.61 billion, and its shares dropped $5.57 or 6.95 per cent to US$74.56.
The company formerly known as Ivanhoe Mines Ltd. had a quarterly net loss of US$285.9 million or 35 cents a share as it worked toward getting a massive copper and gold mine in Mongolia into commercial production next year. Vancouver-headquartered Turquoise Hill (TSX:TRQ) is now majority-owned by Anglo-Australian mining giant Rio Tinto PLC (NYSE:RIO) and its shares were up two cents to C$8.30.
Labrador Iron Mines Holdings Ltd. (TSX:LIM) fell 15 cents or 7.43 per cent to $1.87 as it disappointed investors with a loss of $10.6-million or 16 cents a share in its latest quarter It also recognized $38 million of revenue from the sale of three shipments from its operation at the Port of Sept-Iles, Que. Analysts had been expecting a profit and about $57.6 million of revenue.