Toronto's main stock index fell sharply on Friday, as Canada's biggest trading partner failed to strike a deal to avoid automatic spending cuts.
The S&P/TSX composite index dropped 52.96 points to begin Friday at 12,768.87
The Canadian dollar gave back 0.04 cents at 96.99 cents U.S.
Auto parts maker Magna International Inc reported a 12.5% rise in profit on strong performance in its North American business, and raised its full-year sales forecast. Shares in Magna climbed $2.47 to $57.32.
Ithaca Energy Inc said it would acquire Valiant Petroleum Plc for 203 million pounds in cash and shares. Ithaca stock fell 10 cents per share to $1.87.
National Bank of Canada, the country's sixth-largest lender, on Thursday said its first-quarter profit rose 3.7% due largely to improved wealth management income. National shares dipped 45 cents to $78.11.
Royal Bank of Canada is seeking ways to re-enter U.S. consumer banking just two years after it took a $1.6-billion loss from the sale of its money-losing U.S. retail bank network. Shares in Canada’s biggest bank lost 22 cents each to begin Friday at $63.80.
On the economic front, Statistics Canada reported this morning that economic growth is still a good-news-bad-news story in this country. The agency said real gross domestic product edged up 0.2% in the fourth quarter of 2012, similar to the gain in the third quarter. On a monthly basis, however, real gross domestic product by industry declined 0.2% in December.
ON BAYSTREET
The TSX Venture Exchange slipped 6.27 points to 1,127.09
ON WALLSTREET
Wall Street investors were likely to lose momentum Friday, dragged down by market uncertainty overseas, a weak report on personal income, and concerns about events -- or lack of events -- in Washington
The Dow slumped 41.54 points to begin March at 14,013.70.
The S&P 500 index subtracted 6.98 points to 1,507.70. The tech-heavy NASDAQ Composite subsided 14.10 points to 3,146.09.
Assuming no last-minute deal, $85 billion U.S. in automatic spending cuts are due to begin Friday, although it may be weeks or months before the pain is felt. Still, markets are likely to remain in a cautious mood as major indexes hover just below record highs.
In corporate news, Best Buy's stock rose 5% in premarket trading after the electronics retailer reported that its quarterly revenue rose slightly year-to-year, despite the closure of 49 big box stores.
The company said that same-store sales rose nearly 1% in the U.S, but dipped nearly 1% internationally. Best Buy said its adjusted diluted earnings per share fell to $1.64, from $2.18 in the year-earlier quarter.
Groupon shares rose 3.5% in premarket trading Friday after the daily deals site announced that embattled CEO Andrew Mason would be replaced.
Gap shares rose 3.6% in premarket trading following fourth-quarter earnings from the apparel maker Thursday that beat expectations.
Shares of Salesforce.com rose 3% in premarket trading following strong earnings announced after the bell.
Economically speaking, the U.S. Commerce Department reported that personal income fell 3.6% in January, which was the steepest month-to-month drop in 20 years. Personal income was expected to have dropped 2.4%, according to a Briefing.com consensus of economist forecasts. Personal spending notched up 0.2%, as expected.
Moreover, the Census Bureau publishes data on construction spending. Construction spending is expected to have increased 0.5% in January.
Also, the Institute for Supply Management will release its monthly manufacturing report, and the University of Michigan and Thomson Reuters will publish the final edition of their consumer sentiment index for February.
The ISM Index is expected to have slipped to 52.4 in March, from the prior month's index of 53.1, according to Briefing.com consensus. Anything above 50 signifies expansion.
The University of Michigan consumer reading is expected to remain at 76.3 for February.
Prices on the 10-year U.S. Treasury gained ground, lowering yields to 1.85% from Thursday’s 1.89%. Treasury prices and yields move in opposite directions.
Oil prices slipped $1.40 to $90.65 U.S. a barrel.
Gold prices regained $5.30 to $1,583.40 U.S. an ounce.
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