The Toronto stock market was lower Thursday as traders worry that the U.S. Federal Reserve will end its open-ended stimulus program of bond purchases by the end of the year.
The S&P/TSX composite index tumbled 70.64 points by noon to 12,643.41
The Canadian dollar fell 0.2 to 98.18 cents U.S.
Consumer discretionary stocks declined. Tim Hortons Inc. is planning to increase its quarterly dividend by 23.8%. It also said quarterly revenue was up 4.1% to $811.6 million, less than half the growth rate of the year as a whole.
Net income attributable to shareholders also fell, dropping 2.5% from a year earlier to $100.3 million or 65 cents per share. Its shares dropped $1.84 to $48.96.
Shares in home improvement retailer Rona Inc. fell 38 cents to $11.68 as the company said it is cutting 200 full-time administrative jobs across Canada as it looks for ways to become more efficient and improve the customer experience. Rona also says it’s taking a hard look at its network of big-box retail stores outside Quebec and at its commercial and professional division.
The industrials sector fell with shares in Bombardier Inc. down 27 cents or 6.3% to $4.01 after it said fourth-quarter net income fell by $200 million U.S. to just $14 million before adjustments, mostly due to weak results from its rail division. Ex-items, earnings were down $39 million or 17 per cent to $188 million U.S. or 10 cents per share, which met expectations.
Oil prices were also undercut by data showing U.S. oil inventories rose last week by a much more than expected 4.14 million barrels. Canadian Natural Resources was down 56 cents to $30.01.
Copper prices were down sharply for a second day with the March contract on the Nymex off five cents at $3.55 U.S. a pound, adding to a four-cent fall Wednesday. The base metals sector was down as HudBay Minerals fell 64 cents to $9.43.
Financials were also weak as Bank of Montreal declined 54 cents to $62.78.
The gold sector was up as Barrick Gold climbed 41 cents to $31.22 and Iamgold Inc. rose 19 cents to $7.76.
In other earnings news, grocer Loblaw Cos. Ltd earned quarterly net income of $143 million or 48 cents per diluted share, compared with $174 million or 60 cents per share a year ago. Revenue rose 1.2% to $7.46 billion from $7.37 billion. Its shares gained 15 cents to $39.90.
ON BAYSTREET
The TSX Venture Exchange subsided 2.51 points to 1,128.66
All but four of the 14 Toronto subgroups were lower by midday, weighed down mostly by the metals and mining group, off 1.7%, industrials, down 1.5% and energy, 1.4% less energetic.
The four gainers were led by gold, shining 2.1% brighter, materials, better by 0.7%, and utilities, gaining 0.5%.
ON WALLSTREET
U. S. stocks declined for a second straight day Thursday amid ongoing weakness in Europe, a slew of economic reports and quarterly results from Wal-Mart.
The Dow Jones Industrial Average remained negative 72.35 points to 13,855.20
The S&P 500 index sank 9.64 points to 1,502.31. The tech-heavy NASDAQ Composite dipped 35.14 points to 3,129.27
Wednesday and Thursday's combined losses mark the biggest two-day drop in U.S. stocks this year. Stocks are still up between 4% and 6% in 2013, but the S&P 500 is now headed for its first weekly loss of the year, down more than 1% over the past three days.
The Dow is headed for its third consecutive weekly decline, while the NASDAQ is poised for its second straight weekly drop.
On the corporate front, Wal-Mart reported earnings that beat forecasts but said sales had softened during the quarter. The retailer also hiked its annual dividend by 18%.
Tesla shares sank 10% after the electric-car maker posted a wider-than-expected loss for the fourth quarter.
Hewlett-Packard is up after the closing bell.
Shares of Constellation Brands jumped after Anheuser-Busch InBev and Grupo Modelo SAB said they are in talks with the Justice Department to try and resolve an antitrust lawsuit challenging their planned merger.
Last week, AB InBev agreed to sell Constellation its rights to distribute Modelo in the United States as well its brewery in Piedras Negras, Mexico, in an effort to rescue the deal.
Apple shares fell 0.8% after Foxconn said it is slowing its hiring of workers at factories in China. The Taiwanese company makes about 40% of the world's consumer electronics gadgets, including products and parts for Apple, Intel and Cisco
Investors were disappointed Thursday after a survey of purchasing managers showed Europe's downturn worsened in February. The index has been stuck below 50 for a year, indicating the services sector has been contracting.
Speaking of things economic, U.S. initial jobless claims rose to 362,000 last week, coming in higher than economists were expecting.
The Consumer Price Index was unchanged month-over-month in January, and up 1.6% from a year ago. Core CPI, which strips the price of food and energy, increased 0.3% month-over-month in January, and 1.9% from a year earlier.
The U.S. National Association of Realtors reported that existing home sales rose 0.4% in January. But the number of homes for sale dropped to the lowest level in more than 13 years.
Prices on the 10-year U.S. Treasury were higher, pushing yields down to 1.97% from Wednesday’s 2.02%. Treasury prices and yields move in opposite directions.
Oil prices dove $2.29 to $92.93 U.S. a barrel.
Gold prices fell 40 cents to $1,577.60 U.S. an ounce.
