Stocks went in opposite directions Wednesday, with investors in Toronto developing progressively colder feet due to technology and financial stocks.
In New York, stocks found momentum at the end of a choppy session, after lawmakers announced that the U.S. Senate and House of Representatives had reached a compromise deal on an economic stimulus package.
The S&P TSX Composite Index stumbled 49.46 on the day to finish at 8,768.43, after an earnings warning posted by technology whiz Research in Motion, prompting a sharp drop in share prices.
Investors were discouraged by a lack of details from U.S. Treasury Secretary Timothy Geithner on how Washington plans to direct more than $1 trillion U.S. in public and private aid to support the ailing financial system.
RIM shares fell $12.48 or 17.7% to $58.40 in Toronto, even as it disclosed a rise of more than 20% in subscriber additions for the holiday quarter. But the BlackBerry maker added that it will report fourth-quarter profit at the low end of its guidance of 83 to 91 cents US per share on revenue near forecast levels of $3.3 billion to $3.5 billion U.S.
The TSX energy sector started the session off strong, but by the afternoon was down 1.6% as a report showed U.S. crude inventories rose for a seventh straight week, up 4.7 million barrels to an 18-month high. EnCana Corp. fell $1.61 to $53.70 and Canadian Natural Resources dropped $1.79 to $43.09.
The financial sector was down, with Scotiabank off 41 cents to $29.77, while Royal Bank gave back 31 cents to $30.39.
The TSX gold sector was up, as Goldcorp Inc. advanced $2.34 to $39.17 while Barrick Gold Corp. climbed $1.98 to $48.17.
The base metals sector ran ahead 4% as Ivanhoe Mines progressed 60 cents to $4.49 and Inmet Mining Corp. gained $2.34 to $27.99.
BCE Inc. posted a fourth-quarter loss of $48 million or six cents per share on investment losses and writedowns. The telecom company also boosted its dividend 5% and its shares were ahead 51 cents to $25.64.
WestJet shares dropped 86 cents to $12.89 as fourth-quarter profit fell to $40.8 million from $75.4 million.
Fourth-quarter profits at fertilizer producer Agrium Inc. fell to $124 million from $172 million, but its annual profit of $1.3 billion more than tripled its previous record earnings in 2007. Agrium shares rose 92 cents to $46.93.
CAE Inc. rose 11 cents to $7.41 after the Montreal-based global leader in flight simulators reported a 35% climb in quarterly net profit to $53.3 million as revenue rose 23% to $424.6 million.
The Canadian dollar inched ahead 0.23 cents to 80.49 cents U.S.
On the economic front, investors also took in a report showing that Canada recorded a trade deficit of $458 million in December. It is the first such deficit since March 1976 in December as exports and imports both dropped amid a global economic downturn.
Statistics Canada said exports dropped 9.7% while imports fell 5.7%.
Exports to the United States dropped 10%.
BAYSTREET
The 13 TSX sub-groups were about evenly split between losers and gainers, with the groups listing downward getting a slight advantage. Information technology was the worst off of the seven that lost ground, off 5.1%, followed by financial stocks, down 1.6% and energy stocks, also down 1.6%.
Gold shone brightest of the gainers, up 7.4%, metals and mining the runner-up at 4%, and materials, up 3.6%.
The TSX Venture Exchange picked up 8.51 points to finish at 910.60, while the NASDAQ Canada index dipped 63.82 points, to 493.08
ON WALLSTREET
The Dow Jones industrials index rallied 50.65 points to close at 7,939.53. The Standard & Poor’s 500 index increased 6.58 points to 833.74, while the NASDAQ composite index was up 5.77 to 1,530.50
The current version of the economic stimulus package is estimated to be worth about $789 billion U.S. The Senate passed its version of the economic stimulus bill Tuesday and the House passed a different version of the bill two weeks ago.
Both houses are expected to vote on the compromise in the next few days. President Obama has said he wants the final version of the bill on his desk by next Monday, Presidents Day.
Economically speaking, trade data from the United States was equally dramatic as in Canada. The trade deficit fell 4% to $39.9 billion U.S., to the lowest level in nearly six years in December as the recession depressed demand for imports.
In company news, Applied Materials cautioned late Tuesday that chipmakers will spend 50% less this year for its products. The company also posted a fiscal first-quarter loss of nearly $133 million U.S. and said it will cut 14% of its workforce, or about 2,000 jobs.
New York energy companies were also sharply lower with ExxonMobil down $2.19 to $73.95 U.S.
Treasury prices rose, lowering the yield on the benchmark 10-year note to 2.78% from 2.81% Tuesday.
The March crude contract on the New York Mercantile Exchange was down $1.67 to $35.88 U.S. a barrel.
The April bullion contract in New York moved up $30.30 to $944.50 U.S. an ounce.
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