The main Toronto stock index opened lower on Thursday, hurt by falling commodity prices, as investors grew cautious about the outcome of a European Union summit beginning later in the day.
The S&P/TSX Composite Index settled 49.27 points to begin the day at 11,361.67
The Canadian dollar shed 0.59 of a cent to 96.94 cents U.S.
Investors were also expected to focus on results from Research In Motion Ltd later in the session. The BlackBerry maker is expected to post an adjusted loss of eight cents a share in the three months to June 2, according to the average estimate of analysts.
Among other stocks to watch this morning, oil and gas producer Niko Resources Ltd reported a fourth-quarter loss and forecast a 23% decline in production for the next fiscal year as output from its D6 block off India's east coast fell.
On the economic slate, Statistics Canada reported this morning that average weekly earnings of non-farm payroll employees were $896.63 in April, up 1.0% from the previous month. On a year-over-year basis, earnings increased by 3.1%.
ON BAYSTREET
The TSX Venture Exchange inched up 0.39 points to 1,171.82. The Nasdaq Canada index subtracted 1.53 points to 358.23
All but one of the 14 Toronto subgroups were negative to start out. Materials slid 1.5%, while gold and the metals and mining group gave back 1.4%.
Energy stocks proved the lone holdout, gaining 1.2%.
ON WALLSTREET
Bank stocks sparked a broad sell-off on Wall Street early Thursday as a key summit of European leaders got underway.
Investors were also waiting for the U.S. Supreme Court's ruling on President Obama's healthcare reform law.
The Dow Jones Industrials dipped 86.96 points to begin the session at 12,540.05
The S&P 500 shaved off 7.87 points to 1,323.98. The Nasdaq Composite Index lost 23.38 points to 2,851.94
Hospitals such as Community Health Systems and HCA, and insurers such as UnitedHealth, WellPoint and Humana, could have a lot to gain or lose on the decision.
Shares of News Corp. dropped after the company's board unanimously approved separating its entertainment side from publishing. Rupert Murdoch will chair both companies.
Family Dollar's stock sank after the operator of discount chains reported earnings and revenue that fell short of expectations, and reaffirmed its guidance.
Nike and Research In Motion will report their quarterly earnings after the closing bell.
Nike is expected to post earnings of $1.37 U.S. a share on $6.5 billion U.S. in revenue. Research In Motion is expected to report a loss of one cent per share on $3.1 billion U.S. in revenue, which would be a 37% drop versus last year.
Bank stocks came under pressure after The New York Times reported that JPMorgan's, trading losses at the firm could reach $9 billion U.S. Shares of JPMorgan fell 3%, while Bank of America, Morgan Stanley, and Citigroup dropped 2% Thursday.
European leaders are faced with the daunting task of coming up with a concrete solution to the continent's debt crisis. But with so many similar summits having come and gone, investors aren't betting on any concrete solutions emerging.
Spain has been of particular concern, with its stratospheric borrowing costs threatening to drive it from private markets.
Italy may be in similar trouble. Borrowing costs have been steadily rising, and while the yield on the 10-year bond hasn't yet reached 7% -- it now hovers above 6.2%. Early Thursday, the government auctioned €5.4 billion for 5- and 10-year bonds pushing yields up slightly.
Economically speaking, the U.S. Labor Department reported Thursday morning that weekly jobless claims dropped 6,000 to 386,000, slightly more than expected. And the final estimate of first-quarter U.S. GDP growth was in line with expectations at 1.9%.
The price on the benchmark 10-year U.S. Treasury gained ground, pushing the yield down to 1.58% from Wednesday’s 1.62%. Treasury prices and yields move in opposite directions.
Oil for August delivery dropped 41 cents to $79.80 U.S. a barrel.
Gold futures for August delivery fell $14.10 to $1,564.10 U.S. an ounce.
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