Canada's main stock index dipped sharply on Monday after U.S. Federal Reserve officials hinted that the central bank could halt its asset purchases program in 2013.
The S&P/TSX composite index fell 89.66 points to begin the week at 12,451.15
The Canadian dollar nipped up 0.08 cents to 101.43 cents U.S.
Canaccord Genuity raised the target price of U.S. listed shares of Valeant Pharmaceuticals International Inc. to $74 from $70 on revenue, EPS growth in line with expectation, potential upside to 2013 guidance and the strong likelihood of additional M&A activity. Valeant stock dipped 26 cents to $59.75.
Canaccord Genuity also raised the target price for Bank of Montreal from $66 to $68; Bank of Nova Scotia to $67 from $62; RBC to $70 from $65 and TD Bank to $98 from $92 on cyclical and improved investor sentiments. BMO stock lost 23 cents to $61.40, while Scotiabank faded 36 cents to $57.23, RBC lost 51 cents to $60.56 and TD demurred 65 cents to $82.15
On the economic front, the Ivey purchasing managers’ index expanded more than expected in December, after contracting for the first time in five months in November. The index rose to 52.8 in December from a reading of 47.5 in November.
A figure above 50.0 indicates industry expansion, below indicates contraction.
ON BAYSTREET
The TSX Venture Exchange defied the negative trend and gained 0.44 points to 1,228.66
All 14 Toronto subgroups moved earthward, weighed mostly by energy and consumer staple stocks, each off 1%, while materials slid 0.8%.
ON WALLSTREET
U.S. stocks opened lower Monday, as investors remain focused on Washington and await corporate results later this week.
The Dow Jones Industrial Average lost 54.60 points to open Monday at 13,380.60
The S&P 500 deducted 6.52 points to 1,459.95. The Nasdaq Composite descended 7.11 points to 3,094.55
International banks won a concession Sunday from the Basel Committee on Banking Supervision, which relaxed rules for lenders that had been proposed in hopes of preventing another global financial crisis. U.S.-listed shares of Deutsche Bank and UBS were higher.
Shares of Bank of America rose after it announced a $10.3-billion U.S. settlement with Fannie Mae to resolve current and future repurchase claims on loans that were originated before December 31, 2008.
Meanwhile, aluminum producer Alcoa will be the first major firm to report fourth-quarter earnings after the closing bell Tuesday. Wells Fargo will release its results Friday.
U.S. stocks rallied in the first week of 2013, with the S&P 500 ending Friday at its highest level since December 2007.
Investors welcomed a compromise deal on the fiscal cliff, but lawmakers delayed many of the most contentious decisions on spending cuts. Officials in Washington are now gearing up for a fight over the debt ceiling.
If the nation's borrowing limit isn't raised by late February or early March, the United States runs the risk of defaulting on its obligations because the Treasury would no longer have enough money available to pay all the country's bills.
Prices on the 10-year U.S. Treasury note were static Monday morning, keeping yields at Friday’s 1.91%
Oil prices shed 32 cents to $92.77 U.S. a barrel.
Gold prices dipped 60 cents an ounce to $1,648.30 U.S.
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