Equities in Toronto dropped sharply soon after the start of business on Tuesday, hurt by concerns the slow global economy will continue to weigh on corporate earnings and Moody's credit downgrade of five Spanish regions.
The S&P/TSX composite plummeted 220.51 points, or 1.8%, to open Tuesday at 12,183.03
The Canadian dollar gained 0.11 cents to 100.91 cents U.S.
Canadian National Railway Co. posted a modest increase in quarterly profit on Monday as revenues climbed for all its business segments, and affirmed its full-year forecast despite its caution over the economy. CN shares retreated $2.75, or 3.2%, to $84.32.
TransCanada Corp.said on Monday it had restarted its major oil pipeline to the central United States from Canada following a five-day outage to check for a potential defect on the line in the U.S. Midwest. TransCanada shares fell 61 cents to $43.31.
Speaking of things economic, figures released this morning by Statistics Canada revealed that retail sales rose 0.3% to $39.1 billion in August. However, factoring out the effects of price changes, particularly higher food and gasoline prices, retail sales in volume terms declined 0.3%.
Moreover, the Bank of Canada kept its trendsetting policy interest rate at 1% for the 17th consecutive time today, but signaled that it’s worried about household debt.
ON BAYSTREET
The TSX Venture Exchange went south 20.98 points to 1,287.43
All 14 Toronto subgroups were down at the outset, weighed mostly by global base metals, which took a 2.9% pasting. Metals and mining tailed off 2.7% and gold lost 2.4% of its sheen.
ON WALLSTREET
U.S. stocks sold off early Tuesday after three Dow components issued disappointing earnings and forecasts.
The Dow Jones Industrial average retreated 213.59 points, or 1.6%, to open at 13,132.30
The S&P 500 index ducked back 18.28 to 1,415.54, while the Nasdaq lost 32.04 to 2,984.92
Even with the sharp declines, all three indexes are still up between 8% and 15% this year.
Shares of DuPont fell 8% after the Dow component reported weaker-than-expected quarterly earnings and announced plans to cut 1,500 jobs worldwide. Another Dow component, United Technologies, reported better-than-expected earnings but missed on revenue and lowered its revenue forecast for next year.
Economic bellwether and Dow component 3M reported earnings that were in line with forecasts, but the company missed revenue estimates and pulled back on its guidance.
UPS, another economic bellwether, reported results that were roughly in line with expectations.
After the bell, Facebook and Netflix will release their reports.
Analysts at S&P Capital IQ predict third-quarter earnings for companies in the S&P 500 will grow by just 0.04% overall this quarter, the worst since the third quarter of 2009.
In addition to the earnings news, Apple is expected to unveil its iPad mini at an event in California at 1 p.m. ET.
Yahoo shares rose 4% after the company's third-quarter earnings handily beat estimates late Monday.
Shares of hard drive maker Western Digital Corporation slumped 5%, after the company offered weak guidance for the upcoming quarter, citing weakness in the PC industry.
The price of the benchmark 10-year U.S. Treasury gained, lowering the yield to 1.77% from Monday’s 1.80%. Treasury prices and yields move in opposite directions.
Oil prices fell $1.74 to $86.91 U.S. a barrel.
Gold prices shed $13.80 to $1,712.50 U.S. an ounce.
