The Toronto stock market registered a triple-digit tumble Wednesday morning as investors feared that a failure to resolve the looming American "fiscal cliff" crisis will send the U.S. into recession and pull down other economies.
The S&P/TSX Composite Index plunged 204.87 points, or 1.7%, to end Wednesday at 11,929.79
The Canadian dollar dropped 0.11 of a cent to 99.66 cents U.S.
Iamgold Corp. tumbled 19.5% to $11.98 after the miner reported a 10% drop in revenue to $386.8 million in the latest quarter. Net earnings ran up 56% to $78 million. Ex-items, earnings came in at $60.2 million, or 16 cents a share, down from $112.4 million a year ago. Analysts had called for adjusted earnings per share of 24 cents on $427 million in revenue.
Elsewhere in the sector, Goldcorp Inc. lost $1.65, or 3.8%, to $41.28.
The base metals sector was down with December copper down two cents at $3.46 U.S. a pound. Rio Alto Mining lost 38 cents, or 6.6%, to $5.35 while Taseko Mines shed 11 cents to $2.71.
The energy sector was off as Suncor Energy declined 69 cents to $31.86.
Industrial stocks were also weak and shares in Bombardier Inc. fell 11 cents to $3.19 after the S&P ratings agency lowered its long-term corporate rating one notch to 'BB' from 'BB+' with a stable outlook.
S&P cited Bombardier's "significantly lower-than-expected" cash generation this year as customer advances and operating profit fell amid the weak global economy. Fitch Ratings recently did the same and Moody's shifted its outlook on the company from stable to negative and lowered its liquidity rating, citing similar reasons.
The consumer staples sector was higher amid positive earnings reports from the country's biggest grocers.
Loblaw Companies Ltd. shares ran up 29 cents to $33.64 as the company increased its quarterly dividend by nearly five per cent. The retailer also said net income fell by 5.9% to $222 million or 79 cents per share, however, due to several items excluded from the adjusted earnings.
Metro Inc. reported its quarterly net income was up 75.9% compared with the same time last year, rising to $145.1 million or $1.46 per share. Metro's overall sales were up 11.1% to $2.9 billion, while same-store sales from locations open at least a year were up 1.1%.
Its shares ticked 42 cents higher to $59.00.
Another strong gainer on the TSX was home improvement chain Rona Inc. Its stock rose 54 cents or 4.9% to $11.52 after fund manager Invesco Canada, which controls about one-10th of the company's stock, called for shareholders to remove Rona's board of directors and install new directors.
No major Canadian economic data were released Wednesday
ON BAYSTREET
The TSX Venture Exchange swooned 28.20 points to 1,258.69
All but one of the 14 Toronto subgroups went south Wednesday. Gold plummeted 4%, while materials surrendered 3.5%, and the metals and mining group staggered 2.5%.
The lone gainer was in consumer staples, up 0.3%.
ON WALLSTREET
U.S. stocks fell more than 1% Wednesday as fears of turmoil in the Middle East added to ongoing concerns about a fiscal showdown in the United States.
The Dow Jones Industrials toppled 185.23 points, or 1.5%, to 12,571.
The S&P 500 fell 19.04 points to 1,355.49, and the Nasdaq Composite Index tumbled 37.08 points to 2,846.81
Stocks have been under pressure this month as concerns about the fiscal cliff have dominated the market following the election of President Obama.
Most investors expect a compromise, but they are not taking any chances until Obama and Republicans in Congress reach a deal to avert the onset of automatic tax hikes and spending cuts that could push the economy into recession.
Shares of Teavana surged 52% after Starbucks announced plans to buy the tea company for $620 million U.S. in cash. Starbucks stock was down about 2%.
Facebook shares rose more than 12% even though more than 800 million shares became available to be sold. Like many initial public offerings, Facebook's May 18 debut included a "lockup" agreement that requires some shareholders from selling for a certain period.
On Wednesday, early employees and investors got their first chance to sell about 773 million shares, as well as another 31 million restricted stock units.
Shares of retailer Abercrombie & Fitch shot up 32% after the company reported sales and earnings that towered over expectations and raised its full-year earnings guidance above even the most bullish forecasts.
Staples shares rose after the company beat third-quarter earnings estimates but fell short on revenue.
Cisco shares rose about 5% after the tech giant reported earnings and sales data that beat analysts' expectations late Tuesday.
On the economic board, the U.S. government reported retail sales fell 0.3% in October, citing a negative impact from Superstorm Sandy. It was slightly worse than the 0.2% decline forecast by economists.
Meanwhile, prices at the wholesale level decreased 0.2%, according to the Producer Price Index report. They had been expected to increase by 0.1%, led by higher energy and food prices.
The Census Bureau said business inventories rose 0.7% in September, slightly better than the 0.6% rise economists had forecast.
Minutes from the latest Federal Reserve policy meeting suggest the central bank will continue to buy assets once its so-called Operation Twist program ends.
The price on the benchmark 10-year U.S. Treasury gained in the afternoon, lowering yields back to Tuesday’s 1.59%. Treasury prices and yields move in opposite directions.
Oil prices regained 87 cents to $85.88 U.S. a barrel.
Gold prices took on $2.20 an ounce to $1,727.00 U.S.
