Toronto stocks plunged yet again on Tuesday, following the lead of U.S. and European markets. Weakness in the industrial and consumer staples sectors have pushed Bay Street's main index lower.
The S&P TSX Composite Index dumped another 1.9%, or 190.66 points, to end the day’s trading at 9.836.77. The index fell nearly 2.5% yesterday.
Among industrial stocks, Canadian Pacific Railway declined 5.6% to $40.66, and Canadian National Railway slid 5.4% to $45.55
In the consumer staples group, Viterra dropped 6.1% to $9.15, Loblaw was down 5.7% to $32.54 and Maple Leaf Foods lost 2.9% to $8.25.
Jean Coutu climbed 1.1% to $9.48 after the company reported a first-quarter profit of $10.3 million or $0.04 per share versus a loss of $20.2 million or $0.08 per share in the prior-year period.
In other corporate news, Air Canada ended the day off 5.6% to $1.35 after the airliner said it flew 4.17 billion revenue passenger miles and 5.15 billion available seat miles, on a consolidated basis with Jazz, in June 2009, resulting in a traffic decrease of 9.1% and capacity decrease of 7.6% as compared to June 2008.
Tecsys Inc. put on 2.8% to $1.84 after the company reported that its fourth-quarter net income increased to $572,000 or $0.04 per share from $49,000 or breakeven per share last year. Revenue decreased to $10.4 million from $10.6 million prior year
Magma Energy Corp. was down 2% at $1.48 per share after the company priced its initial public offering of common shares at $1.50 apiece.
On the economic front, building permits in May surpassed the $5-billion mark for the first time since October 2008, according to data released by Statistics Canada.
Meanwhile, the Office of the Superintendent of Bankruptcy Canada reported Canadian bankruptcies rose 31% year-over-year in the month of May.
The Canadian dollar was down 0.50 cents to 85.72 cents U.S.
ON BAYSTREET
Of the 14 TSX subgroups, all but two were negative by noon, weighed down by industrials, down 3.6%, consumer staples, off 3.1%, and financials, off 2.3%.
The two gainers were health-care stocks, up 1.7% and gold, gaining 0.6%.
The TSX Venture Exchange was actually up 4.93 points, to 1,069.56, while the Nasdaq Canada Index slipped 20.13 points to 648.58.
ON WALLSTREET
In New York, stocks plunged Tuesday, falling to six-week lows, as fears that the market has gotten ahead of any economic recovery were ramped up ahead of the start of the quarterly reporting period.
The Dow Jones Industrials average plummeted 161.27 points, or 1.9%, to close at 8,163.60. The S&P 500 index lost 17.69 points to 881.03. The Nasdaq stumbled 41.23 points to 1,746.17.
Stocks have been inching lower since mid-June as a three-month stock market rally has lost steam.
A selloff in commodity prices took its toll on the underlying stocks, adding to the market weakness and worries about the duration of the recession.
Underscoring the depth of the recession, a report Tuesday afternoon from the Mortgage Bankers Association showed that delinquencies on credit cards and other loans jumped to a record 3.23% in the first quarter. That was a modest rise from the previous quarter.
Economic news due later this week includes readings on retail sales, the job market, import and export prices and consumer sentiment.
Investors are also primed for the start of the second-quarter reporting period, which unofficially kicks off after the close Wednesday with Dow component Alcoa. The aluminum maker is expected to post a loss of 37 cents per share, according to Thomson Reuters estimates. Alcoa earned 65 cents a year ago.
Next week brings reports from some of Wall Street's biggest financial firms, including Goldman Sachs and JPMorgan Chase.
Declines Tuesday were broad-based, with 25 of 30 Dow components sliding. Falling oil prices dragged on Dow oil components Chevron and Exxon Mobil. The biggest losers were Boeing, IBM, Hewlett-Packard, 3M and United Technologies.
However, most quarterly financial reports are due out later in the month. Market participants will be looking to see not only that companies beat forecasts, but that they provide an encouraging outlook for future quarters.
Economic concerns will form a backdrop for the G8 summit of the world's leading industrialized nations that begins Wednesday in L'Aquila, Italy. President Obama will be joined by leaders of Japan, Britain, France, Italy, Germany, Canada and Russia.
Treasury prices rose, lowering the yield on the benchmark 10-year note to 3.46% from 3.51% late Thursday. Bond markets were closed Friday. Treasury prices and yields move in opposite directions.
Energy prices slipped, with U.S. light crude oil for August delivery falling $1.12 to settle at $62.93 U.S. a barrel on the New York Mercantile Exchange.
COMEX gold for August delivery fell $4.80 to settle at $929.10 U.S. an ounce.
