Stock traders bade a not-so-fond farewell to a rough, albeit short, week Friday, with markets on both sides of the border smarting from near-historic losses.
Both Toronto and New York markets were off Monday for the Family Day and Presidents Day holidays, respectively.
The S&P TSX Composite Index plunged 223.11 points Friday to 7,962.24 as the main index closed in on its most recent low of 7,725 from late November, due largely to weakness in financials and energy stocks.
The financial sector in both countries bore the brunt of early losses as investors worry that a string of programs announced by the Obama administration in the past two weeks won't be enough to pull the U.S. out of a deep recession.
In particular, investors have been disappointed over a lack of details contained in U.S. Treasury Secretary Timothy Geithner's bank bailout announcement last week.
The TSX financial sector fell hard, with Royal Bank down $1.75 to $26.18 and Manulife Financial lost $1.40 to $13.10.
Kingsway Financial Services Inc. said Friday its loss for the fourth quarter exceeded gloomy estimates released earlier this month, citing underwriting charges at one of its troubled U.S. subsidiaries and impairments to goodwill.
Kingsway, which focuses primarily on auto insurance, reported a loss of $360.4 million U.S., which widened year-earlier losses of $103.5 million. Its shares fell 16 cents to $2.99.
Shares in Fairfax Financial Holdings Ltd. were down $24.72 to $346.79 even as the international insurance and investment company reported the biggest annual profit in its 23-year history thanks to "the best returns ever in a brutal investment environment."
The company, which keeps its accounts in U.S. dollars, earned $1.47 billion on revenue of $7.98 billion for the year.
The energy sector also dipped, as oil prices fell back from Thursday's 14% surge. Suncor Inc. declined $1.76 to $22.19 in Toronto and Canadian Natural Resources stepped back $2.12 to $38.24.
The gold sector did provide support, however, rising as nervous investors sent the price of gold over $1,000 U.S. for the first time in almost a year. Goldcorp Inc. advanced $1.02 to $40.16.
Barrick Gold Corp. shares were up 35 cents to $46.25 after the company took a $773-million U.S. goodwill writedown while posting a fourth-quarter loss of $468 million. Full-year profit dropped to $790 million from $1.12 billion in 2007. Gold production this year is projected between 7.2 million and 7.6 million ounces, lower than 2008 production of 7.66 million ounces.
Teck Cominco Ltd. shares were down 37 cents to $3.68 after the miner agreed to sell its 50% interest in the Williams and David Bell mines in northern Ontario for $65 million U.S. to an affiliate of Barrick. The sale is part of Teck's plan to sell non-core assets to pay down debt.
Shares in Tim Hortons Inc. ran ahead $2.63 to $31.08 even as the coffee shop chain said quarterly profit dropped to $69.1 million from $75.7 million a year earlier. Earnings were reduced by asset impairment charges related to store closures and the company also said it will increase its quarterly dividend by 11% to 10 cents per share.
Shares in Canwest Global Communications plunged 8.5 cents or 20% to 34 cents as the Globe and Mail reported that Leonard Asper is scrambling to secure a financial lifeline for the company before the end of the month to prevent his family-run media empire from sliding into bankruptcy protection.
Meanwhile, data showed falling prices in Canada and the U.S.
Statistics Canada reported the country's annual inflation rate edged lower to 1.1% in January from 1.2% the previous month, driven lower by falling gasoline prices.
Overseas, General Motors Corp.'s Swedish-based subsidiary Saab went into bankruptcy protection today so the unit can be spun off or sold by its struggling U.S. parent, officials said.
The move comes after Sweden turned down GM's request for government help for Saab.
The Canadian dollar had regained 0.62 cents by the end of the week to 80.05 cents U.S.
BAYSTREET
Of the 13 TSX sub-groups, all but two were down on the day; financials were 5.3% poorer, energy stocks nearly 5.3% less energetic, while information technology stocks lost 5%.
Gold stocks shone 2.6% brighter, while materials were marginally ahead, 0.6%.
The TSX Venture Exchange dropped 9.20 points to 892.90 while the NASDAQ Canada index shed 23.72 points, to 411.58
ON WALLSTREET
The Dow Jones industrials index lost 100.28 points to 7,365.67 plumbing new six-year-plus lows, as worries about the outlook for the banking sector exacerbated fears of a prolonged recession.
The Standard & Poor’s 500 index surrendered 8.90 points to 770.04, while the NASDAQ composite index skidded 1.59 points to 1,441.23
Stocks had tumbled through the early afternoon on worries about the economy and the future of the biggest banks, amid talk that the government might have to nationalize the hardest hit companies.
But stocks managed to cut losses and the Nasdaq turned higher for a while after White House spokesman Robert Gibbs reiterated that the administration believes in a privately-held banking system.
In New York, fears of bank nationalization sent Bank of America plunging 65 cents to $3.28 U.S. while Citigroup dropped 62 cents to $1.89 U.S.
Economically speaking, U.S. consumer prices rose by 0.3% last month, the biggest monthly increase since a 0.7% rise in July. But inflation for the 12 months ending in January was zero.
U.S. home improvement retailer Lowe's says its fourth-quarter profit dropped 60% to $162 million U.S. as consumers spent less on items for their houses amid a deepening recession. The company also expects lower earnings this year.
Treasury prices rallied, lowering the yield on the benchmark 10-year note to 2.77% from 2.81% Thursday.
The March crude contract in New York was down $1.08 to $38.40 U.S. a barrel.
The April bullion contract on the New York Mercantile Exchange closed up $25.70 to $1,002.20 U.S. an ounce
