The Toronto stock market dipped slightly at the start to September trading Tuesday while traders wondered what steps central banks might take to support the economic recovery.
The S&P/TSX Composite index stepped back 13.81 points to begin the day, week, and month at 11,935.45
The Canadian dollar backtracked 0.12 cents to 101.32 cents U.S.
Traders also took in major acquisition activity in the pharmaceutical sector.
Montreal-based Valeant Pharmaceuticals International Inc. is buying U.S. dermatology products maker Medicis Pharmaceutical Corp. for about $2.6 billion in cash in a deal to strengthen its position in skin treatments and care.
Valeant said Monday that it is paying $44 per share for Medicis, a 39% premium over Friday’s closing price of $31.87 for the Scottsdale, Ariz., company.
Canada's central bank will be in focus Wednesday as the Bank of Canada makes its next announcement on interest rates. The bank is expected to leave its key interest rate unchanged at one per cent, but traders will look for hints as to when the bank might hike rates.
Canadian employment data is also being released Friday. It is believed that the economy cranked out 11,000 jobs last month.
ON BAYSTREET
The TSX Venture Exchange eked higher by 2.46 points to 1,243.20. The Nasdaq Canada added 5.15 points to 345.68
ON WALLSTREET
Investors may have returned from summer vacation, but they're not running back to the stock market.
U.S. stocks dipped Tuesday after two economic reports showed continued sluggishness in the U.S. economy.
The Dow Jones industrial average jettisoned 98.04 points to 12,992.80
The S&P 500 index faltered 6.06 points to 1,400.52, and the tech-heavy Nasdaq Composite Index was lower by 19.07 points to 3,047.89.
During this Labour Day-shortened week, investors appear to be biding their time for jobs numbers due out Friday and to see what Europe's central bankers will do to protect the vitality of the euro.
Investors shrugged off better-than-expected monthly sales from the big three automakers: General Motors, Ford, and Chrysler.
In his speech last week, Federal Reserve Chairman Ben Bernanke indicated that additional stimulus could be on the way, saying that the central bank is still willing to do whatever it takes to support the economy.
Meanwhile, Europe will once again be in focus after Moody's warned that the European Union's Aaa credit rating was at risk. Moody's revised its outlook on the EU to "negative" from "stable."
As euro-zone leaders return from summer holidays, investors are bracing for several key events in the euro area this month, starting with a crucial meeting of the European Central Bank on Thursday.
European Central Bank President Mario Draghi is widely expected to unveil details of a new bond-buying program for euro-zone governments that agree to certain conditions. But it remains to be seen if Draghi, who many view as the euro's savior, will meet investors' high expectations.
Campbell Soup posted better-than-expected earnings Tuesday morning, sending shares of the company higher.
Smithfield Foods reported earnings of 40 cents U.S. per share, coming in below analyst expectations. The company cited growth in its packaged meat business, but poor performance of its fresh pork business dragged on profits.
Shares of Facebook were slightly lower, after the social network's stock hit a new low on Friday.
Economically speaking, the Institute for Supply Management's ISM Manufacturing Index for August will be released later this morning. The index is expected to come in at 50.0, according to a survey of analysts by Briefing.com, up from 49.8 in July.
Also on tap for Tuesday morning, the Census Bureau will release figures for July construction spending, which is expected to have risen by 0.5%.
The price on the benchmark 10-year U.S. Treasury rose, pushing the yield sharply lower to 1.56% from 1.62% late Friday. Treasury prices and yields move in opposite directions.
Oil prices for September delivery fell 89 cents to $95.58 U.S. a barrel.
Gold futures for December delivery added $11.80 to $1,699.70 U.S. an ounce.
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