The Toronto stock market lost more than 100 points Monday, amid concerns that Spain will need a full-scale sovereign bailout while traders took in two major acquisitions in the Canadian energy sector.
The S&P/TSX Composite index tumbled 143.72 points, or 1.2%, to approach noon at 11,479.19, off its lows of the morning, however.
The Canadian dollar faded 0.32 cents to 98.30 cents U.S.
China National Offshore Oil Company is picking up Calgary-based oil and gas producer Nexen Inc. for $15.1 billion U.S. in cash. CNOOC is paying $27.50 a share, a 61% premium on the closing price of its shares on Friday at the New York Stock Exchange. On the TSX, its shares soared 53.44% to $26.53.
And Talisman Energy Inc. is selling its 49% interest in U.K. North Sea assets to Chinese firm Sinopec Corp. for $1.5 billion. Its shares jumped 67 cents or 6.06 to $11.72.
The energy sector found some support from the two Chinese deals. However, Suncor Energy dropped $1.16 to $29.32 and Cenovus Energy lost 77 cents to $31.77.
The base metals sector fell as metal prices also backed off with September copper down nine cents to $3.35 U.S. a pound. Teck Resources gave back $1.27 to $29.32 and Ivanhoe Mines shed 37 cents to $8.13.
Among gold issues, Barrick Gold Corp. faded 68 cents to $34.27.
In the financial area, TD Bank dropped $1.25 to $78.75.
The industrials sector gave back strength while Canadian National Railways lost $1 to $86.90.
In other corporate developments, regulatory filings show that investor Prem Watsa now has a 9.9% stake in BlackBerry maker Research in Motion Ltd.. Watsa is the CEO of insurer Fairfax Financial Holdings Ltd. He had earlier reported a 5.12% holding in RIM. Watsa’s stake was valued at about $356.2 million, as of Friday’s closing on the TSX. RIM dipped 11 cents to $6.76.
ON BAYSTREET
The TSX Venture Exchange retreated 20.63 points to 1,175.56. The Nasdaq Canada index plunged 8.79 points to 330.88.
All but one of the 14 Toronto subgroups lost ground this morning, with metals and mining weighing most heavily, at 3.6%, global base metals off 2.6%, and materials sliding 2.1%.
The lone stalwart was energy, up 0.9%.
ON WALLSTREET
Stocks plunged Monday, with the Dow also sinking more than 100 points, as worries that Spain may need a full-blown bailout sparked a global selloff.
The Dow Jones industrial average declined 139.33 points, or 1.1%, by midday to 12,590.98, after falling more than 230 points during the morning run
The S&P 500 gave back 19.82 points to 1,342.84. The Nasdaq fell 51.65 points to 2,873.65.
McDonald's shares slipped after the fast-food restaurateur missed earnings and revenue expectations, citing a slowing global economy.
Hasbro's stock rose after the toymaker reported second-quarter earnings beat analyst expectations. But the gains were limited as the company's revenue dropped 11% and missed Wall Street's forecast.
Shares of Halliburton edged higher after the oil and natural gas services company posted better-than-expected earnings as strong drilling activity in international markets offset a slowdown in North America.
Later this week, UPS, AT&T, Ford, Apple and Amazon are slated to open their books. Facebook is also set to report its first quarterly earnings as a public company.
Shares of Nexen jumped more than 50% after China's state-owned oil producer CNOOC agreed to buy the Canadian oil and gas producer for $15.1 billion U.S.
Shares of GenOn and NRG Energy climbed after the NRG agreed to buy the Houston-based wholesale power provider in an all-stock deal worth about $1.7 billion U.S.
RailAmerica's stock was higher after Genesee & Wyoming agreed to buy the company for $1.39 billion U.S. in cash.
The selling was widespread, with oil prices tumbling 3% and copper prices skidding 2.7%. The euro weakened further, falling as low as $1.207 U.S.
The debt crisis plaguing Europe is taking a toll on Spain's regional economies, with at least one region, Valencia, said to have requested emergency funding last Friday. A second eastern region, Murcia, denied reports that it was gearing up for its own request.
Euro-zone finance ministers finalized initial bailout terms for Spanish banks, but observers fear that may not be enough.
The yield on the 10-year Spanish bond jumped to a euro-area record high of 7.565% from 7.267% late Friday. Spain's leaders have said that 7% is an unsustainable level. It's also a level that flashes the first bailout signals.
The Bank of Spain also reported that the nation's economy contracted by 0.4% in the second quarter -- that's the third quarterly contraction and shows the euro-zone's fourth-largest economy could be mired in recession for some time.
The price on the benchmark 10-year U.S. Treasury strengthened, pushing the yield down to 1.43% from 1.46% late Friday. Treasury prices and yields move in opposite directions.
Oil for September delivery staggered $2.90 to $88.93 U.S. a barrel.
Gold futures sank $8.40 an ounce to $1,574.80 U.S.
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