The Toronto stock market went for a dunk Thursday afternoon as investors were unnerved by more trouble for debt-burdened European countries and disappointing employment data
The S&P/TSX Composite Index shed 261.70 points, or 2.3%, to 11,128.76, its three-month low.
The energy sector fell as Suncor Energy fell 93 cents to $31.75 and Canadian Natural Resources lost $1.50 to $70.35.
The gold sector was down, as Barrick Gold Corp. faded $1.66 to $36.39 and Goldcorp Inc. stepped back $1.59 to $35.68.
March copper was nine cents lower at $2.88 U.S. a pound and the base metals sector fell, with Teck Resources down $2.79 to $34.07 while HudBay Minerals declined 36 cents to $12.10.
Financials were also a major drag, as Scotiabank gave back 89 cents to $44.79, while Manulife Financial was down 70 cents to $19.36.
The tech sector managed a gain in the wake of a solid earnings report from Cisco Systems after the close Wednesday. Open Text Corp. shares jumped $3.51, or 8.2%, to $46.54 after the company reported Wednesday a second-quarter profit of $21.2 million U.S., up sharply from a year ago and boosted by strong revenue growth. But elsewhere in the sector, Research In Motion Ltd. shed $1.07 to $70.93.
In other earnings news, telecom giant BCE Inc. said its acquisition of The Source electronics stores and the remaining half of Virgin Mobile Canada helped it turn a $350-million profit and increase quarterly revenues by 3.9% to $4.65 billion. That was a sharp reversal from a $48-million loss for the same period last year. BCE shares gained 74 cents to $28.36.
Canaccord Financial Inc. shares dipped 20 cents to $9.60 after it said its revenue in the last three months of 2009 nearly doubled compared with a year earlier, reaching $173.2 million. The Vancouver-based securities broker also says net income was $15.1 million or 27 cents per share, compared with a loss of $1.27 per share or $62.4 million a year earlier when Canaccord recorded substantial one-time charges.
Its quarterly financial report didn’t comment on a news report that said Canaccord has been in talks to acquire Toronto-based Genuity Capital Markets.
Husky Energy Inc. earned $320 million or 38 cents a share for the last quarter, compared with a profit of $231 million or 27 cents a share in the same period of 2008. Its shares fell 37 cents to $26.57.
Meanwhile, debt-laden European countries, particularly in Greece, Spain and Portugal, have increasingly been in focus this week amid concerns that leaders in Athens and Lisbon would not be able to push through unpopular austerity programs to tame their ballooning deficits.
On Wednesday, the European Commission gave its cautious backing to the Greek government’s plan to slash the budget deficit but the markets remain unconvinced that Greece can pull it off. They are increasingly coming round to the view that Portugal and Spain, in particular, will face mounting difficulties dealing with their own budgetary problems.
In economic news back home, Statistics Canada reported that building permits rose a sequential 2.4% in December and was up 32.6% from a year ago period. The rise was largely due to a jump in non-residential sector.
The Canadian dollar slid 0.90 cents to 93.24 cents U.S.
ON BAYSTREET
In all, 12 of the 14 TSX subgroups were lower. Metals and mining took the biggest hit on the day, plummeting 5.9%, while global base metals and materials plunged 5% each.
The lone gainer was information technology, which only made it out of the woods by 0.2%. Telecoms were flat on the day.
The TSX Venture Exchange got clobbered 61.80 points to 1,452.18, while the Nasdaq Canada index had subsided 19.35 points to 711.88.
ON WALLSTREET
In New York, stocks tumbled Thursday, with the Dow and S&P 500 near three-month lows, amid fears of sovereign debt woes in Europe and a rise in weekly jobless claims ahead of Friday's big monthly employment report.
The Dow Jones industrial average fell back 268.37 points -- its worst one-day point loss since April 20 of last year -- to 10,002.18, a descent of 2.6%. The S&P 500 index slid 34.17 points to 1,063.11. The Nasdaq composite surrendered 65.48 points to 2,125.43.
Debt woes propelled the dollar to a more than seven-month high versus the euro, which in turn pummeled dollar-traded commodities such as oil and gold. Treasury prices spiked, lowering yields, in a classic flight-to-safety move.
Meanwhile, the VIX, Wall Street's fear gauge, spiked 18%, suggesting investor nervousness was increasing.
The stronger dollar sent oil and gold prices lower, and stocks such as Chevron and Exxon Mobil sliding. With energy one of the biggest sectors in the S&P 500, the selloff in the sector dragged on the broader market.
Weaker-than-expected labour market reports on both Wednesday and Thursday also played a role, creating jitters ahead of Friday's January jobs report.
Stocks rallied in the last nine months of 2009 as investors dug back in after a brutal start to the year. The S&P 500 gained 65% between the 12-year lows hit on March 9 and year-end.
That advance continued up until around Jan. 19 of this year. But between that high and the end of January, the S&P 500 lost just short of 7%.
After the close of trading Wednesday, tech leader Cisco Systems reported better-than-expected quarterly sales and earnings.
Toyota Motor reported improved earnings in its most recent quarter and also lifted its estimates for the fiscal year ending in March. But the results did not include the impact of the huge recall of millions of vehicles due to gas pedal problems. Toyota estimates that the global recall could cost it as much as $2 billion U.S.
On Thursday, the government announced a formal probe into brake problems in the popular Prius hybrid
On the economic front, December factory orders rose 1% versus forecasts for a rise of 0.5%. Orders rose 1% in the previous month.
Elsewhere, the number of Americans filing new claims for unemployment rose to 480,000 last week from a revised 472,000 the previous week, the Labor Department reported. Economists surveyed by Briefing.com expected 455,000 new claims.
Continuing claims, the number of Americans receiving benefits for a week or more, rose to 4,602,000 from 4,600,000 the previous week. Economists expected 4,581,000.
Investors were also awaiting Friday's monthly report on employment, the most closely watched gauge of the job market. The government report is expected to show a net gain of 15,000 jobs in January, with an unemployment rate of 10%, according to the Briefing.com consensus.
But the Bureau of Labor Statistics is also expected to issue a big downward revision to its estimate of U.S. payrolls in the 12 months from April 2008 through March 2009.
Elsewhere on the economic calendar, December factory orders rose 1% versus forecasts for a rise of 0.5%. Orders rose 1% in the previous month.
Treasury prices rose sharply, corresponding lowering the yield on the 10-year note to 3.59% from Wednesday’s 3.70%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil stumbled $3.89 to $73.05 U.S.
Gold prices took a header of $48 to $1,064 U.S.
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