Thursday featured a sell-off by investors in Toronto and New York, as more companies reported gloomy earnings and/or employment numbers.
The S&P TSX Composite Index tumbled 148 points, to 8,758.23, virtually blunting any enthusiasm caught by Wednesday’s triple-digit gains.
Energy stocks, particularly Petro-Canada, were down. Petro-Canada reported a 2008 profit increase of 15% to $3.1 billion despite a $691-million net loss in the fourth quarter, largely on a currency translation of U.S.-dollar debt.
Falling oil prices pushed Canadian Oil Sands Trust fourth-quarter profits down to $124 million from $515 million, prompting the trust to cut its quarterly distribution to 15 cents per unit from 75 cents.
The gold sector pushed forward, including Goldcorp Inc. and Barrick Gold Corp., both of which improved in price.
The tech sector was also positive with shares in Open Text Corp. leaping, after it beat analysts' estimates in terms of revenue and adjusted earnings in its most recent quarter but the software company saw its net income fall 92% to $800,000 U.S.
The base metals sector moved down after Anglo-Swiss company mining company Xstrata PLC proposed a $5.9-billion U.S. plan to raise capital from shareholders Thursday as preliminary results for 2008 indicated profits dropped by more than a third.
Teck Cominco Ltd. fell, likewise, Quadra Mining Ltd., after it changed its operating plan at the Robinson mine in Ely, Nev., and reduced planned copper production this year by 7%.
Nova Chemicals shares tumbled, after the company reported a fourth-quarter loss of $214 million U.S., down from a year earlier profit of $126 million. Revenue slipped to $1.2 billion U.S. from $1.8 billion.
TransAlta Corp.was ahead slightly as it reported fourth-quarter earnings of $94 million, down from $130 million in a year-earlier result boosted by tax gains. Full-year earnings fell to $235 million from $309 million due to the writedown of its Mexico business and higher income taxes. It increased its dividend two cents to 29 cents.
The Canadian dollar had given back 0.62 cents to $81.71 cents U.S.
BAYSTREET
Ten of the 13 TSX sub-groups were lower on the day, metals and mining went down into the earth 6.1%, followed by industrials, off 4.4% and financials, ahead 4.3%
Gold was the shiniest of the three groups that did gain ground, lifting itself 6.4%. Materials were 3.7% stronger and information technology stocks were up 1.0%.
The TSX Venture Exchange continued to go against the downward trend Thursday, tacking on 10.62 points to 880.54, while the NASDAQ Canada index was down 12.95 points to 545.10
ON WALLSTREET
The Dow Jones industrials index lost much of the juice it had gained Wednesday, falling 226.44 points to 8,149.01. The Standard & Poor’s 500 index was off 28.95 points to 845.14. The NASDAQ composite index was 50.5 points down, to 1,507.84
Economically speaking, the U.S. Labor Department reported that initial jobless claims increased to 588,000 in the week ended Jan. 24, from the revised figure of 585,000 the prior week. This is worse than the 575,000 claims that were forecast by a consensus of economists.
The government also reported that durable goods orders, an important measure of manufacturing, dropped 2.6% in December, compared to a 1.5% decline the prior month. This is worse than the 2.2% forecast decline.
Sales of new homes in America plunged 14.7% in December to the slowest monthly pace on record. For all of 2008, U.S. builders sold 482,000 units, the weakest result since 1982.
After the close, online retailer Amazon.com reported quarterly sales and earnings that topped analysts' forecasts. Shares gained 3% in extended-hours trading.
Before the market opened, Ford Motor said it lost $5.9 billion in the fourth quarter and $14.6 billion for the full year. However, the company again said it does not need the federal bailout that's already been taken by rivals General Motors and Chrysler.
Ford's credit unit said it was cutting 1,200 jobs or 20% of its staff.
Employers have been announcing thousands of job cuts each day this week, including potentially more than 13,000 Thursday. Companies impacted included photo products maker Eastman Kodak investment services company Charles Schwab and drug maker AstraZeneca
Late Wednesday, Starbucks reported quarterly sales and earnings that were short of forecasts and said it could cut up to 6,700 jobs in 2009. Shares were little changed Thursday.
Consumer products company Colgate-Palmolive said its fourth-quarter earnings rose nearly 20% because of cost cuts, higher prices and new products.
Dow component 3M reported weaker quarterly earnings that nonetheless topped forecasts, and warned that 2009 earnings won't meet its earlier forecast. 3M is seen as something of a proxy for the economy due to its varied businesses. Shares gained 3% Thursday.
Dow component AT&T stumbled 4.5% one day after it reported lower quarterly earnings and higher revenue, both of which missed forecasts.
Late Wednesday, the U.S. House of Representatives approved President Obama’s proposed $816-billion economic stimulus package Wednesday. The plan is aimed at pulling the economy out of recession through a combination of tax cuts and $604 billion in spending. The vote was divided along party lines; the package got no support from Republicans in the House.
Treasury prices dipped, raising the yield on the benchmark 10-year note to 2.69% from 2.66% Wednesday. Treasury prices and yields move in opposite directions. Yields on the 2-year, 10-year and 30-year Treasurys all hit record lows last month.
U.S. light crude oil for March delivery fell 72 cents to settle at $41.44 U.S. a barrel on the New York Mercantile Exchange.
COMEX gold for April delivery rose $16.50 to $906.50 U.S. an ounce.
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