Equity markets in Toronto dropped on Thursday as worries about the financial woes of a major Portuguese bank rippled across global equity markets.
The S&P/TSX composite index fell 81.17 points to greet noon at 15,134.02
The Canadian dollar shaved off 0.06 cents to 93.82 cents U.S.
Shares of energy producers gave back strength, with Suncor Energy losing 1.6% to $44.91 and Canadian Natural Resources Ltd declining 1.7% to $48.16.
Financials, the index's most heavily weighted sector, slipped as well. Royal Bank of Canada shed 0.5% to $78.13.
The gold-mining sector jumped, buoyed by a rally in the bullion price. Goldcorp shot up 2.6% to $30.98, and Barrick Gold Corp advanced 2.3% to $20.60.
In corporate news, Cogeco Cable reported a lower third-quarter profit and cut its full-year profit outlook. The stock was down 1.8% at $58.13.
Investors were fearful of a contagion effect after shares in Banco Espirito Santo (BES), Portugal's largest listed bank by assets, plunged more than 15% on growing concerns that financial troubles at holding companies of the bank's founding family will have an impact on BES.
On the domestic economic beat, Statistics Canada reported this morning that housing prices rose 0.1% in May, following five months of gains ranging from 0.1% to 0.3%. The increase was largely the result of higher new home prices in the Prairie region.
ON BAYSTREET
The TSX Venture Exchange slumped 6.22 points to 1,026.41.
All but four of the 14 Toronto subgroups were lower, weighed mostly by energy, down 1.1%, industrials, lower by 1%, and consumer discretionary stocks, off 0.8%.
The four gainers were led by gold, picking up 1.4%, materials, up 0.3%, and the metals and mining group, up 0.2%.
ON WALLSTREET
U.S. stocks are down sharply Thursday as jitters about a Portuguese bank and ugly economic data raise more doubts about whether Europe is recovering.
The Dow Jones Industrials plummeted 119.38 points to 16,866.23
The S&P 500 faltered 13.10 points to 1,959.73, and the NASDAQ composite pulled back 40.65 points to 4,378.38.
After Alcoa kicked off earnings season earlier this week with a home run, a number of retailers reported mixed results on Thursday.
Family Dollar started in the red but was recently trading slightly higher after the struggling retailer reported a drop in same-store sales and profits. The discounter also dimmed its forecast slightly. But Family Dollar has a plan to lure in shoppers: booze. The company said it will follow Wal-Mart by selling beer and wine in the coming years.
While Family Dollar is stuck in the red, shares of Zumiez popped 8% after the company boosted its profit outlook for the rest of the year thanks to soaring June sales.
Shares of Tractor Supply Co. slumped 2% after the company posted disappointing earnings on Wednesday.
Investors took a big axe to shares of Lumber Liquidators. The flooring retailer plummeted 22% after disclosing a traffic tumble and projecting profits that would badly miss expectations.
The somber news sparked selling in home improvement stocks like Ethan Allen Interiors, Lowe's and Home Depot.
Potbelly, which went public in October, plummeted 23% after the sandwich chain cut its outlook for the year and said it will try new marketing moves.
TRW Automotive Holdings raced 7% higher amid M&A buzz. The car safety equipment supplier has received a buyout bid from Germany's ZF Friedrichshafen, Bloomberg News reported.
T. Rowe Price was among the worst financial performers after the asset manager was reportedly downgraded by Evercore. The worry is that T. Rowe could be hurt by in the coming months by investors yanking cash from U.S. equity funds.
The ugly day actually began in Europe, where a little-known Portuguese bank brought back concerns about the health of the continent's financial system.
Trading of Espirito Santo Financial Group -- the leading shareholder in Portugal's biggest bank -- was suspended. Shares of Banco Espirito
Santo plummeted 17% before they were also halted.
The euro banking woes trickled down to U.S. financial firms, with shares of Bank of America, Morgan Stanley and JPMorgan Chase all down about 1%.
Americans received another glimmer of hope about the jobs market on Thursday. The U.S. Labor Department said initial claims for jobless benefits fell by 11,000 last week to 304,000. That was slightly better than many on Wall Street expected.
The weekly claims report comes on the heels of the June jobs report, which revealed the U.S. added an impressive 288,000 jobs.
Prices for 10-year U.S. Treasuries leaped, lowering yields to 2.52% from Wednesday’s 2.55%. Treasury prices and yields move in opposite directions.
Oil prices fell seven cents to $102.22 U.S. a barrel.
Gold prices vaulted $14.80 to $1,339.10 U.S. an ounce.
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