Stock markets were flat Tuesday, retaining most of the big gains racked up Monday despite a guarded assessment of the economy from U.S. Federal Reserve chairman Ben Bernanke.
The S&P TSX composite index kept its winning streak alive, however barely, nosing into the black by 10.35 points, to finish at 9,880.72.
Commodity stocks took the biggest hit after leading the market upward Monday, but this was partly offset by rising financials.
Data released today showed the American service sector contracted less than expected last month and the rate of decline slowed, another sign the steep downturn may be bottoming out.
In earnings news, Loblaw Cos. Ltd. rang up a 73% increase in first-quarter profit to $109 million. Sales at Canada's biggest grocer increased nearly three per cent to $6.7 billion and its shares advanced $2.48 to $35.31.
WestJet rose 87 cents to $13.35 after a smaller than expected reduction in first-quarter earnings to $37.4 million, down 29% from a year ago. Revenue descended 3% to $579.3 million, but lower fuel costs partly offset weaker demand.
Brookfield Asset Management Inc. with holdings in real estate, forestry, power generation and other sectors, said its first-quarter profit faded by more than half to $93 million U.S. Its shares were up 22 cents at $18.37.
U.S.-Canadian beer maker Molson Coors Brewing Co. credited strong brands, lower costs and higher prices for an 84% rise in first-quarter earnings from continuing operations to $79.6 million U.S., despite a 2.7% decline in its worldwide beer volume. Its shares gained $4.41 in Toronto to $50.99
The Toronto energy sector slipped EnCana Corp. was down 98 censt to $59.02 while Suncor Inc. was 48 cents lower to $32.83.
The base metals sector gave back ground, but Teck Resources gained nine cents to $15.79 and Sherritt International was down 26 cents to $5.18.
The TSX gold sector faded but Barrick Gold Corp. improved 73 cents to $37.18.
Toronto financials edged up as Bank of Montreal climbed $1.77 to $42.76 and CIBC rose $1.47 to $57.47.
The Canadian dollar was off 0.16 of a cent to 85.08 U.S., after a winning streak of several days.
ON BAYSTREET
Of the 13 TSX subgroups, financials led the eight groups going upward, gaining 2.1%, followed by consumer discretionaries, ahead 1.4%, and consumer staples, rising 0.8%.
The five laggards were weighed down by metals and mining, off 2.4%, energy, trailing 1.3% and telecoms, down 0.4%.
The TSX Venture Exchange picked up 3.17 points to 1,030.36, while the Nasdaq Canada index added 9.76 points to 714.41.
ON WALLSTREET
The Dow Jones Industrials limped home 16.09 points off Monday’s dizzy pace, to finish Tuesday’s trading at 8,410.65.
The S&P 500 index lost 3.44 points to 903.80, while the Nasdaq gave back 9.44 points to 1,754.12.
Expectations that the worst is over for the economy have lifted stocks over the last two months, with the Nasdaq rising eight straight weeks after falling to a six-year low. The Dow and S&P 500 have risen for seven of eight weeks, after falling to more than 12-year lows.
The economy will bottom and start to rebound later this year, but the recovery process will be slow and choppy, Federal Reserve Chairman Ben Bernanke told the Joint Economic Committee. His comments essentially reiterated the statement from the last Fed policy meeting.
The Institute for Supply Management's index on the services sector of the economy rose to 43.7 in April from 40.8 in March. Economists surveyed by Briefing.com thought it would rise to 42.2.
Any reading below 50 still indicates contraction, but the improvement suggests the pace of the slowdown is easing.
Bank of America, Citigroup and Wells Fargo have all been mentioned over the last few days as companies that will potentially need to raise more capital.
AIG is expected to report a quarterly loss when it releases results late Thursday. However, the company is not expected to need more money from the U.S. government, Reuters reported. Shares rallied 14% Tuesday.
Dow component Kraft Foods reported higher quarterly earnings that topped estimates. But revenue fell as the stronger dollar hurt sales overseas. Kraft shares rallied 4%.
Treasury prices slipped, raising the yield on the benchmark 10-year note up to 3.16% from 3.15% Monday. Treasury prices and yields move in opposite directions.
U.S. light crude oil for June delivery fell 63 cents to settle at $53.84 U.S. a barrel on the New York Mercantile Exchange.
COMEX gold for June delivery settled up $2.10 to $904.30 U.S. an ounce.
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