Equities in Canada’s biggest centre opened slightly higher on Monday, helped by a rebound in Valeant Pharmaceuticals International Inc but weighed by resource stocks as commodity prices fell.
The S&P/TSX composite index fell 6.66 points to begin the week and the month at 13,522.51. The index lost 3% last week, but gained 1.7% through October.
The Canadian dollar settled 0.1 cents at 76.40 cents U.S.
Cameco Corp reported lower adjusted third-quarter earnings on Friday, as an oversupply in the market continued to affect demand and pricing. The company said its quarterly profit, excluding one-time items, was hurt by a smaller gross profit from its uranium segment and lower tax recovery in the quarter. On an adjusted basis, earnings fell to $78 million, or 20 cents per share, compared with $93 million, or 23 cents per share, a year earlier.
Cameco shares collapsed 39 cents, or 2.1%, to $18.13.
Royal Bank of Canada scrapped an internal limit on mortgage loan size for immigrants in the spring to tap into surging demand for financing on multi-million dollar houses by newcomers to Vancouver. It removed its $1.25-million cap on loans to borrowers with no local credit history.
RBC shares dipped 37 cents to $74.40.
Hedge fund billionaire William Ackman spent nearly four hours on Friday trying to convince the world that Valeant Pharmaceuticals was a good buy but it was short-seller Andrew Left's tweet promising fresh allegations about the Canadian company that got noticed. By the end of trading, Valeant's stock price had tumbled, wiping $6.2 billion off its market capitalization and taking Ackman's own losses on the company to roughly $2 billion.
Valeant shares sprang to life $6.06, or 5%, to $128.10.
Canaccord Genuity cut the target price on Bombardier to $1.10 from $1.35 on the risk that the Quebec government will prevail on the Federal government and Bombardier to have Ottawa match Quebec’s just announced a $1-billion investment in the CSeries program.
Bombardier shares inched up three cents, or 2.1%, to $1.45.
CIBC cut the rating on Genworth MI Canada to underperform from sector perform following the company’s continued job losses in Alberta, a negative earnings trajectory and a shrinking regulatory capital cushion.
MI shares moved back $1.42, or 4.4%, to $30.91.
CIBC cut the target price on Sirius XM Canada Holdings to $5.00 from $7.50, says the company should see support given an outsized dividend yield, but believe there is much capital appreciation in the near term.
XM shares were unchanged at $4.90.
On the economic calendar, RBC announced that its Manufacturing Purchasing Managers Index posted 48.0 in October, down from 48.6 in September and below the neutral 50.0 threshold for the third month in a row, signaling a deterioration of business conditions.
ON BAYSTREET
The TSX Venture Exchange eased back 0.34 points to 541.69
Seven of the 13 TSX subgroups were higher in the first hour of trade, as health-care climbed 1.7%, real-estate was better 0.5%, and financials inched up 0.2%.
The half-dozen laggards were weighed most by metals and mining, down 1.3%, while gold skidded 0.9%, and consumer staples dipped 0.5%.
ON WALLSTREET
U.S. stocks traded mostly higher Monday, after posting their best month in four years, as investors eyed earnings and a heavy week of economic reports.
The Dow Jones industrial average began the week by gaining 76.46 points to 17,740. Goldman Sachs and Chevron contributed the most to gains in the Dow Jones industrial average.
The S&P 500 recovered 11.35 points to 2,090.71. Health care led nearly all S&P 500 sectors higher.
The NASDAQ index jumped 36.31 points to 5,090.06
Earlier, the major averages opened little changed, with the Dow briefly dipping into negative territory as Visa weighed. The stock traded about 2.7% lower after falling more than 3.5% in morning trade.
The credit card issuer reported earnings that missed on revenue that slightly topped expectations. Visa also announced the purchase of Visa Europe for about $18.2 billion U.S. and authorized a new $5-billion U.S. share repurchase program.
In corporate news, HP Inc. and Hewlett Packard Enterprise began trading as separate companies Monday, following the split of Hewlett-Packard into two.
Earnings season winds down with fewer names reporting this week. AIG and Fitbit are among those posting results after the bell.
In U.S. economic news, October ISM manufacturing was 50.1, slightly beating expectations of 50.0 but posting a fourth-straight monthly decline, Reuters said. Construction spending rose 0.6 percent in September.
The final read on October manufacturing PMI hit a 6-month high at 54.1, according to Markit.
Prices for 10-year U.S. Treasuries were lower, thus raising yields to 2.18% from Friday’s 2.15%. Treasury prices and yields move in opposite directions.
Oil prices fell 30 cents a barrel to $46.29 U.S.
Gold prices slid $8.05 to $1,134.06 U.S. an ounce.
Related Stories
