The Toronto stock market was lower Thursday as another rise in U.S. jobless insurance claims data added to worries about a slowing economic revival, which in turn helped punish oil prices for a third day.
The S&P TSX Composite Index was down 58.61 points to close the day at 11,523.60
Worries about deteriorating economic conditions pushed the TSX financial sector down as TD Bank fell $1.13 to $70.59.
Manulife Financial declined 65 cents or 4.9% to $12.76. Its stock has plunged 19% since surprising investors with a $2.4-billion quarterly loss last week, followed by a downgrade by DBRS.
The TSX energy sector dropped as oil prices moved lower despite data on Wednesday showing a draw in U.S. crude oil stocks last week. But analysts pointed out that oil stocks have been at their highest levels for the end of July in years.
Among oil issues, Canadian Natural Resources lost 92 cents to $33.79.
Suncor Energy Inc. shares were down 45 cents to $32.89 as it agreed to sell some natural gas assets to Direct Energy for approximately $375 million. The Wildcat Hills properties, near Cochrane, Alta., produce about 80 million cubic feet of natural gas and natural gas equivalent per day.
The base metals group was down, with Quadra FNX Mining declined 59 cents to $10.96 while Teck Resources lost 63 cents to $33.98.
The TSX gold component rose, as Barrick Gold Corp. advanced 71 cents to $45.00 while Goldcorp Inc. improved by $1.09 to $42.04.
Research In Motion Ltd. was a major weight on the TSX, down $2.28 to $56.50 after the Indian government said it will shut down BlackBerry email and instant messaging services by Aug. 31 if RIM does not address Indian security concerns.
Several countries including the United Arab Emirates and Saudi Arabia have all expressed concerns about not having access to BlackBerry users’ data.
On the earnings front, Tim Hortons Inc. shares rose $2.33 or 6.6% to $37.77 as the coffee chain reported second-quarter profits rose 21% to $94.1 million. Revenues increased 5.7% to $639.9 million. The company also said it will sell its 50% interest in Maidstone Bakeries to its joint venture partner for $475 million.
Canadian Tire Corp. reported that second-quarter net earnings rose 15.6% to $119.9 million from $103.7 million. Operating revenue improved slightly, rising 3.8% to $2.41 billion. Total retail sales in the second quarter increased 1.3% and same store sales were up 0.8%. Canadian Tire shares were down $1.48 to $54.25.
Loyalty rewards program Groupe Aeroplan Inc. says its second-quarter profit dropped 48% due in part to the impact of one-time charges relating to its Italian business.
Without those charges, adjusted net earnings were $60.9 million or 29 cents per share, up from $52.3 million or 26 cents per share in the comparable period last year and its shares jumped 87 cents or 9.1% to $10.40.
The Canadian dollar regained 0.25 cents to 95.85 cents U.S.
ON BAYSTREET
Eight of the 14 TSX subgroups remained negative by the close. Financials slid 1.6%, while metals and mining and energy groups each lost 1.5%.
Of the half-dozen gainers, health-care stocks proved the strongest, picking up 2.1%, while gold garnered 2% and materials surged 1.7%.
The TSX Venture Exchange progressed 12.31 points to 1,453.74, while the Nasdaq Canada index sank 14.51 points to 626.81
ON WALLSTREET
In New York, stocks fell Thursday, but recouped earlier losses, as investors digested an unexpected rise in jobless claims and Cisco Systems' cautious outlook.
The Dow Jones industrial average gave back 58.88 points to 10,319.95
The S&P 500 index moved lower 5.86 points to 1,083.61, while the tech-rich Nasdaq composite index dropped 18.36 points to 2,190.27
Also continuing to drag down the market was the Federal Reserve's statement from Tuesday, some experts said. The central bank gave its most bearish outlook in more than a year, saying the economic recovery is weakening.
Stocks tumbled Wednesday, with the three major indexes losing more than 2.5%, after a report showed the U.S. trade gap widened and foreign data cast doubt on overseas demand for American goods.
Cisco Systems posted a 79% jump in quarterly profit late Wednesday, but the tech bellwether's revenue missed Wall Street's expectations. The company's sales outlook was also a slight disappointment.
Cisco CEO John Chambers emphasized that while he is confident in his company's ability to continue growing, concerns such as job creation and GDP growth still lurk, and the economy has been sending "mixed signals" to Cisco's customers.
Shares of Cisco were down almost 10% in afternoon trading, dragging down the tech sector.
General Motors posted its second straight profitable quarter Thursday, with earnings of $1.3 billion after the payment of dividends on preferred shares held by the U.S. Treasury. That was a stark turnaround from the $12.9 billion it lost in the year-earlier period, when the company went into bankruptcy.
The results help put GM in position to move ahead with the sale of shares to the public, that is needed to repay taxpayer assistance it received last year.
GM also said chief executive Ed Whitacre will leave his post Sept. 1, to be succeeded by another auto industry outsider, former Nextel Communications CEO Dan Akerson. He will be GM's fourth CEO in just under 18 months.
Federal regulators announced BP will pay a $50-million U.S. penalty in connection with the 2005 explosion at its Texas City refinery that killed 15 workers and injured 170 others.
On the economic front, initial jobless claims jumped unexpectedly to 484,000 last week. That's the highest number of claims filed since February. Economists were expecting claims to drop to 465,000.
Continuing claims, a measure of Americans who have been receiving benefits for a week or more, decreased to 4.45 million from 4.57 million the previous week. Economists were anticipating continuing claims to rise to 4.60 million.
A separate report showed that import prices jumped 0.2% in July from the prior month, and were up 4.9% from a year earlier. The advance was led by higher fuel prices. Export prices fell 0.2% during the month, but were up 3.9% from 2009.
Treasury prices listed lower, raising yields for the benchmark 10-year note to 2.74% from Wednesday’s 2.68%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil surrendered $2.21 to $75.81 U.S.
Gold prices hiked $17 to $1,217 U.S. an ounce.
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