Losses picked up on the Toronto stock market Wednesday afternoon after the Federal Reserve signaled it will further taper its key stimulus program, raising further questions about how emerging market countries can protect their currencies.
The S&P/TSX composite index remained negative 44.56 points, to close at 13,643.10
The Canadian dollar slid another 0.16 cents to 89.50 cents U.S.
Canadian Pacific Railway posted quarterly profit ex-items of $1.91 a share, missing estimates by two cents. Revenue rose 7%, also below estimates, but CP shares gained $6.85, or 4.3%, to $165.00 on a positive outlook for its operating ratio.
The tech sector declined, after CGI Group posted quarterly earnings ex-items of $207.9 million or 65 cents, five cents lower than estimates, and CGI shares fell $1.76, or 5%, to $33.47.
In the financial sector, worries about growth in emerging market countries pushed bank stocks lower as Scotiabank, the most international of the big Canadian banks, shed 53 cents to $61.35.
AGF Management Ltd. dropped 78 cents, or 6.3%, to $11.63 after the investment firm posted earnings that fell short of expectations amid high restructuring costs in the fourth quarter.
The energy sector fell while Canadian Natural Resources fell 30 cents to $36.00.
The base metals index gave back ground as the March copper contract dipped a cent to $3.24 U.S. a pound. First Quantum Minerals lost three cents to $20.33.
The gold sector rose with Goldcorp running ahead $1.02 to $27.64 while Barrick Gold gained 87 cents to $21.83.
ON BAYSTREET
The TSX Venture Exchange peeked up 0.13 points close Wednesday at 958.76
All but four of the 14 Toronto subgroups were lower Wednesday, as information technology stocks took a dive of 1.5%, while consumer discretionary and financial stocks dipped 0.9% each.
The four gainers were led by gold, hiking 3.3%, materials, ahead 1.7%, and industrials, up 0.6%.
ON WALLSTREET
Stocks sank more than 1% on Wednesday after the Federal Reserve announced plans to further reduce its monthly bond buying program.
The Dow Jones Industrial Average swooned 189.77 points, or 1.2%, to 15,738.79, Boeing was the biggest drag on the Dow as investors were disappointed by its earnings outlook. AT&T also gave earnings guidance that fell short of expectations.
The S&P 500 index deducted 18.30 points to 1,774.20. The NASDAQ shed 46.53 points to 4,051.43
While the Fed's decision was not a surprise, some investors had expected the central bank to address the recent turmoil in Turkey and other emerging markets that has spilled over to Wall Street.
And even though nobody was surprised by the Fed's decision to reduce its bond-buying program to $65 billion a month from $75 billion U.S., the move clearly rattled investors.
Yahoo shares sank more than 8% following weak quarterly earnings and sales results.
After the market closed, Facebook reported earnings and sales growth that blew past analysts' expectations. The stock surged on the news.
Apple shares were down again. The stock has been under pressure since the company reported iPhone sales Tuesday that fell short of expectations. Apple briefly dipped below $500 U.S. for the first time since October.
Some traders say Apple shares will continue to slide until CEO Tim Cook demonstrates that the company can still innovate.
Dow Chemical reported better-than-expected earnings and sales, raised its dividend 15% and boosted its share buyback program to $4.5 billion U.S.
Shares of Electronic Arts were higher as investors shrugged off a weak outlook and focused on earnings and sales that topped forecasts.
Overall, the bulk of quarterly results for the companies in the S&P 500 have been better than expected. Of the 114 companies that have reported earnings, 98 have topped analysts' modest expectations, according to S&P Capital IQ.
However, 100 of those companies have issued disappointing earnings guidance.
Emerging markets were under pressure despite moves by central banks to stabilize volatile currencies.
Investors initially cheered the decision from Turkey's central bank to increase rates following late Tuesday. Central banks in India and South Africa have also raised rates. But the optimism quickly faded.
The Turkish lira, as well as other emerging market currencies like Argentina's peso and India's rupee, have slid in recent months amid expectations that the U.S. Federal Reserve will continue to reduce the pace of its monetary stimulus, which has supported the flow of cash into developing economies.
Prices for 10-year U.S. Treasuries gained, lowering yields to 2.68% from Tuesday’s 2.75%. Treasury prices and yields move in opposite directions.
Oil prices slipped 11 cents to $97.30 U.S. a barrel.
Gold prices gained $16.90 to $1,267.70 U.S. an ounce.
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