Resource companies led the way to a negative session on the Toronto stock market Monday amid lower growth forecasts from China.
The S&P/TSX Composite Index approached noon off 122.29 points, or 1%, to 12,521.53
The Canadian dollar slid 0.42 cents to 100.65 cents U.S.
China’s economy grew by 9.2% last year, down from 10.3% in 2010 as the government tries to gradually slow growth and tame high inflation. In addition, many local governments are wracked with debt and with Europe in crisis and the U.S. recovery fragile, demand for Chinese exports is weakening.
Strong Chinese growth has been an important prop for a global economy still struggling to recover from the 2008 financial crisis.
That growth has also supported higher commodity prices and rising stock prices on the resource-heavy Toronto stock market.
The energy sector declined as Imperial Oil shed 51 cents to $46.38 while Suncor Energy dropped 35 cents to $35.10.
But the base metals component was down as May copper shed five cents to $3.86 U.S. a pound.
China is the world’s biggest consumer of copper, viewed as an economic bellwether since it is used in so many businesses. Teck Resources lost 56 cents to $37.96 and HudBay Minerals declined 25 cents to $11.42.
The gold sector lost ground as Goldcorp Inc. gave back 45 cents to $48.12 while Kinross Gold Corp. gave back 16 cents at $10.62.
The utilities group also fell with TransAlta off 28 cents to $20.21.
On the corporate front, construction giant SNC-Lavalin Group Inc. says it will defend itself from a class-action lawsuit filed on behalf of shareholders who acquired its securities between March 2009 and February 2012.
The suit follows last week’s announcement that SNC is investigating $35 million in mysterious payments made by the company that have been attributed to unrelated projects. SNC shares were down 44 cents to $39.56.
Sprott Resource Corp. will invest $50 million U.S. in a newly created U.S. contract-drilling services company named Independence Contract Drilling Inc.
The Toronto-based resources investment company will hold a 31.6% interest in the company as part of an equity offering made by ICD valued at $100 million. Sprott shares were off four cents to $4.04.
ON BAYSTREET
The TSX Venture Exchange dove 19.70 points to 1,659.20, while the Nasdaq Canada index shaved off 6.11 points to 413.57
All but three of the 14 Toronto subgroups were down by lunch time. Metals and mining issues fell 3.6%, global base metals 3%, and materials lost 2.3%.
The lone holdouts were in telecoms, up 0.3%, health-care, 0.2%, better, and real-estate, 0.04% stronger.
ON WALLSTREET
In New York, stocks slid Monday, following the path of world markets, after China lowered its annual growth target.
The Dow Jones Industrials fell 70.72 points to approach noon at 12,906.80.
The S&P 500 subtracted 8.01 points to 1,361.62, while the Nasdaq was weaker by 26.56 points to 2,949.63
Online reviews site Yelp retreated, after spiking 64% to top $24 U.S. a share in their debut on the New York Stock Exchange Friday.
BP shares were higher Monday, after the British oil giant and plaintiffs involved in the legal battle over the Gulf of Mexico oil spill said Friday they have reached an agreement. BP estimated that it would have to pay about $7.8 billion U.S. in the Deepwater Horizon disaster settlement.
Apple said in a post on its website that the tech company has "created or supported" some 514,000 jobs in the United States, either through direct employment, the "App economy" or other means.
Economically speaking, the February edition of the Institute for Supply Management services index rose to 57.3, up from 56.8, which beat expectations.
Last week, the ISM manufacturing index for February slipped to 52.4, from 54.1 in January, indicating a slowdown in the sector's expansion.
Meanwhile, factory orders in January factory decreased 1% -- less than the 1.9% decline analysts were expecting. Factory orders rose 1.4% in December.
Treasury prices for the 10-year note fell again, pushing yields back up to Friday’s 1.99%. Treasury prices and yields move in opposite directions.
Oil for February delivery dropped three cents to $106.67 U.S. a barrel.
Gold futures for April delivery fell $9.20 to $1,700.60 U.S. an ounce.
