Sliding mining stocks helped push the Toronto stock market lower Wednesday while traders looked to the release of information that could provide an idea of what the U.S. Federal Reserve plans to do about winding up a key economic stimulus program.
The S&P/TSX composite index dumped 120.01 points, or nearly 1%, to pause for noon at 12,550.10
The Canadian dollar shed another 0.50 cents to 95.72 cents U.S.
The gold sector declined, while Barrick Gold Corp. faded 35 cents to $20.25.
The base metals sector fell and September copper slipped two cents to $3.31 U.S. a pound. Teck Resources lost 48 cents to $27.10.
Turquoise Hill Resources Ltd. is reported to be conditionally in favour of accepting a Chinese coal company's offer for its majority stake in Inova Resources Ltd., an Australian mining company listed in Toronto and Sydney.
Inova says Shanxi Donghui Coal Coking & Chemicals Group Co., Ltd. is offering 22 cents Australian per Inova share and Vancouver-based Turquoise Hill has agreed to tender it shares, unless a better offer comes forward.
Turquoise Hill rose five cents to $5.35. Inova hasn't traded since Aug. 2, when it closed at 16 cents.
The energy sector was slightly lower while Canadian Oil Sands fell 38 cents to $20.31.
Investors also considered earnings reports from the Canadian and U.S. retail sectors.
Sears Canada posted net income of $152.8 million or $1.50 per share, including an after-tax gain of $164.0 million. Ex-items, Sears lost 11 cents per share. Second-quarter revenue was down 9.6% from the same time last year. Its shares slipped eight cents to $12.19.
Home improvement retailer Lowe's said second-quarter net income rose 26% to $941 million, or 88 cents per share. That's up from $747 million, or 64 cents per share, a year ago. Revenue increased 10% to $15.71 billion from $14.25 billion.
Analysts surveyed by FactSet expected earnings of 79 cents per share on revenue of $15.07 billion and its shares ran up $2.51 to $46.59.
Target Corp. is reporting a 13% drop in second-quarter earnings as the discounter spent money on opening stores in Canada and dealt with cautious shoppers in the U.S. Target earned $611 million, or 95 cents per share. Ex-items, the retailer earned $1.19 per share.
Revenue reached $17.12 billion, up 2%. Analysts were expecting earnings of 96 cents per share on revenue of $17.28 billion, according to FactSet and its shares fell $1.09 to $66.86.
ON BAYSTREET
The TSX Venture Exchange dropped 3.85 points to 928.75
All 14 Toronto subgroups were lower by midday, weighed mostly by the metals and mining group, down 2.9%, while materials and global base metals shed 1.7% each.
ON WALLSTREET
U.S. stocks were mixed in early trading Wednesday as investors await the release of minutes from the U.S. Federal Reserve's latest monetary policy meeting.
The Dow Jones Industrials faded 72.15 points to greet noon at 14,930.80
The S&P 500 index backtracked 8.69 points to 1,643.66. The NASDAQ subtracted 11.38 points to 3,602.21
Corporate earnings remained in focus as several retailers reported results.
Lowe's stock rose after the home improvement retailer announced that its quarterly sales and profit rose from a year earlier. Its strong results come a day after rival Home Depot also issued an upbeat outlook thanks to the continued recovery in the housing market.
In another positive sign for housing, existing home sales rose 6.5% in July from the prior month.
Target shares fell even after the retailer announced significant year-over-year gains in sales. Investors seemed worried about a more tepid outlook for consumer spending.
Shares of Staples dropped more than 10% after the office supply retailer reported lower quarterly sales and profit compared to the prior year. The CEO blamed the declines on weakness in retail stores and said the company was working to ramp up its online sales.
Hewlett-Packard will report after the closing bell. The PC and printer giant is this year's best performer in the Dow as investors have embraced the turnaround strategy of CEO Meg Whitman.
Shares of Heineken were down sharply in Europe after the brewer reported earnings that were worse than expected.
The minutes will be released at 2 p.m. ET. Investors will be looking for clues as to when the central bank might begin cutting back on its massive bond-buying program.
In another positive sign for housing, existing home sales rose 6.5% in July from the prior month.
Prices for the 10-year U.S. Treasury fell, hiking yields to 2.83% from Tuesday’s 2.81%. Treasury price and yields move in opposite directions.
Oil prices subsided 47 cents to $104.64 U.S. a barrel.
Gold prices remained negative $4.40 to $1,368.20 U.S. an ounce.
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