The Toronto stock market sustained a steep, triple-digit slide for a second day Wednesday, the decline led by falling bank and health-care stocks.
New York markets moved lower despite the announcement of a plan from U.S. President Barack Obama to deal with the home foreclosure crisis.
The S&P TSX Composite Index plunged 194.38 points to 8,184.32
The Toronto financial sector was off, as investors worry about the global financial system. In recent days, investor fears have been focused on the ability of banks in Eastern Europe to repay or roll over $400 billion U.S. this year. The banks have borrowed $1.7 trillion U.S., much on short-term maturities.
CIBC fell $1.35 to $42.25, Royal Bank lost 77 cents to $27.38 while insurer Manulife Financial eased 42 cents to $15.25.
The TSX energy sector declined as oil prices stabilized. EnCana Corp. declined $1.83 to $49.47 and Petro-Canada gave back $1.16 to $26.14.
Mining stocks also dragged with the base metals sector down. Teck Cominco Ltd. lost 35 cents to $4.09 after it said Tuesday it is looking at all options reduce a suffocating debt load largely acquired when it paid $14 billion U.S. for Fording Canadian Coal Trust last fall.
Rogers Communications Inc. shares fell $2.76 or 8% to $31.59 after it said a decrease in the value of its television division generated impairment charges that propelled the company to a fourth-quarter loss of $138 million.
The result marks a sharp drop from a profit of $254 million recorded in the same quarter a year earlier.
Grocery chain operator Loblaw Companies Ltd. posted fourth-quarter profit of $188 million, up from a year-earlier $40 million, as sales jumped 11%, helped by one-time gains and an extra week in the accounting period.
Sales rose to $7.75 billion from $6.97 billion and its shares moved 10 cents lower to $33.30.
Research In Motion Ltd. also helped keep the TSX negative, falling $2.90 to $53.64. The stock has been falling since last week after it said its fourth-quarter profits will come in at the lower end of the company's previous guidance and a Credit Sussex analyst cut his rating on the Blackberry maker to under perform from neutral and slashed his earnings expectations for the February 2010 fiscal year.
Other market heavyweights taking the TSX lower included transport giant Bombardier Inc., which lost 31 cents to $2.92.
Canfor Pulp Income Fund units tumbled more than 23% to $2 a day after the 50.2% owned subsidiary of Canfor Corp. said it is reducing distributions 75%. Canfor Corp. stock fell 42 cents, more than 6%, to $6.09.
The Canadian dollar gained 0.42 cents to 79.49 cents U.S.
BAYSTREET
Of the 13 TSX sub-groups, 11 ended the day in negative territory, laden down by health-care stocks, 4.6% to the bad, utilities, off 3.7% and financials, skidding 3.6%.
The two intrepid groups in the black were materials, up a full percentage point, and gold, ahead 0.8%.
The TSX Venture Exchange stumbled 3.34 points to 915.82 while the NASDAQ Canada index capsized 21.12 points, to 439.40
ON WALLSTREET
The Dow Jones industrials index was up only slightly, 3.03 points, to end the day at 7,555.63.
The Standard & Poor’s 500 index was 0.75 points off to 788.42, while the NASDAQ composite index fell 2.69 points to 1,467.97.
A day after signing a massive $787-billion U.S. stimulus plan into law, President Obama announced plans to tackle the foreclosure crisis with a $75-billion U.S. program.
The initiative is designed to help up to five million borrowers refinance, and provides incentive payments to mortgage lenders in an effort to help up to four million borrowers on the verge of foreclosure.
The announcement of mortgage relief comes just after data showed construction of new homes in the U.S. plunged to a record low in January as all parts of the country showed big declines in building activity.
The U.S. Commerce Department says construction of new homes and apartments dropped 16.8% last month to a seasonally adjusted annual rate of 466,000 units, well below the 530,000 units economists expected, and was the slowest pace on records dating back half a century.
Applications for building permits also dropped to a record low.
Also, the Federal Reserve reported that U.S. industrial production fell 1.8% last month, worse than the 1.5% slide that economists expected.
General Motors Corp. and Chrysler have filed restructuring plans with the U.S. government that call for an additional $39 billion U.S. of aid. The two automakers have already received $17.4 billion U.S.
The requests, made in government-required restructuring plans filed Tuesday, were accompanied by plans for thousands more job cuts, slashing of models and brands, union concessions and the prospect of even further expense cuts.
GM shares declined 11 cents to $2.07 U.S.
Treasury prices slipped, raising the yield on the benchmark 10-year note to 2.69% from 2.65% Tuesday.
The March crude contract on the New York Mercantile Exchange gained 47 cents to $35.40 U.S. a barrel
The April bullion contract in New York was up $10.70 to $978.20 U.S. an ounce
