The Toronto stock market was little changed Tuesday amid plans by Canadian Pacific's biggest shareholder to lighten its position and a setback for the telecom sector.
The S&P/TSX Composite Index acquired 16.15 points to move into afternoon trading at 12,625.95
The Canadian dollar slipped 0.72 cents to 96.57 cents U.S.
Canadian Pacific Railway weighed on the TSX, down $3.95 or 2.9% to $131.55 after Bill Ackman's Pershing Square Capital Management, CP's biggest shareholder, said Monday that it plans to sell up to seven million of the railway's shares over the next six to 12 months.
The stock has soared since Ackman won the battle to install new board members and a new chief executive, Hunter Harrison, who formerly held the top executive job at Canadian National.
Meantime, the railway has been cut to underperform from sector perform by RBC Capital Markets following Pershing Square's announcement after the market close Monday. It also set a price target of $104 per share. RBC said the move to sell the shares will result in limited upside for the stock and will put investor focus back on the fundamentals. The stock is up 84% over the past 12 months.
The telecom sector was also in focus after Federal Industry Minister Christian Paradis said Mobilicity and other new wireless carriers won't be allowed to transfer spectrum to other carriers, saying the government will stand by the rules it put in place to boost competition.
The minister's announcement Tuesday will be a setback for Telus, which had asked permission to acquire unused spectrum from Mobilicity. The wireless industry has been calling on Ottawa to clarify the rules ahead of the next auction of wireless spectrum, which Paradis said will be delayed to Jan. 14 to allow more time for new entrants to prepare.
Telus shares declined 55 cents to $35.24.
The gold sector was down as Barrick Gold faded 57 cents to $21.39.
The energy sector gained as Cenovus Energy gained 30 cents to $31.30.
July copper edged up two cents to $3.34 U.S. a pound, taking the base metals sector ahead First Quantum Minerals climbed 16 cents to $18.54.
Speaking of things economic, Statistics Canada reported this morning that our merchandise imports rose 1.2% in April, while exports edged down 0.2%. As a result, Canada's trade deficit with the world went from $3 million in March to $567 million in April.
ON BAYSTREET
The TSX Venture Exchange dropped 6.98 points to at 962.08
Eight of the 14 Toronto subgroups climbed into positive country by midday, with metals and mining jumping 1.2%, information technology up 0.5% and energy gaining 0.4%.
The half-dozen laggards were weighed by gold, off 1.6%, consumer staples, down 0.7%, and global base metals, down 0.2%.
ON WALLSTREET
U.S. stocks drifted between small gains and losses Tuesday as investors continue to wrestle with an uncertain outlook for Federal Reserve policy.
The Dow Jones Industrials moved south 34.55 points to 15,219.50
The S&P 500 index shed 1.15 points to 1,639.27. The tech-rich NASDAQ Composite fell 2.62 points to 3,462.75.
If the Dow manages even a small gain today, it will be the 21st Tuesday in a row that the blue chips will have ended in positive territory.
Salesforce.com shares fell after the company signed a deal to acquire cloud marketing platform ExactTarget for $2.5 billion U.S. Shares of ExactTarget surged 50%.
General Motors shares rose following news that the automaker will rejoin the S&P 500, replacing H.J. Heinz at the end of trading Thursday.
Zynga shares flipped between small gains and losses, following a 12% plunge on Monday, after the online game maker said it would cut more than 500 jobs, or nearly 20% of its staff.
Lululemon is bringing back its yoga pants after making changes in the material to solve a problem that made them see-through.
Dollar General reported earnings and sales in line with forecasts but lowered its guidance. The news weighed on shares of other discount retailers, including Family Dollar and Dollar Tree
In economic news, the U.S. government's trade deficit rose to $40.3 billion in April from $37.1 billion U.S. in March, as imports outpaced exports.
Prices for the 10-year U.S. Treasury strengthened, lowering yields to Monday’s 2.13%. Treasury prices and yields move in opposite directions.
Oil prices lost 34 cents to $93.11 U.S. a barrel.
Gold prices sank $15.60 to $1,396.30 U.S. an ounce
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