Toronto stocks remained notably lower on Wednesday, moving further away from a multi-month high. Weakness in the resource sectors dragged the market into negative territory, and kept it there.
Late in the session, the S&P/TSX Composite Index had slid another 111.24 points, or 1.1%, to 10,459.30, for its second consecutive negative session.
Mining stocks dropped as copper posted notable losses on the Comex. Inmet plunged 5.9% to $42.39 adding to yesterday's losses. First Quantum dropped 3.8% to $63.90 and Teck Resources was down 3.4% at $25.48.
Energy stocks lost ground following a U.S. government report showing a larger-than-expected build in weekly crude oil inventories. Baytex dropped 4.8% to $20.62, Suncor was down 3.8% at $33.40, Canadian Natural Resources subsided 2.8% at $61.70 and Canadian Oil Sands gave back 2.6% at $26.01.
Talisman Energy dropped 4.4% to $16.34 after the company reported its second-quarter net income was $63 million or $0.06 per share, down from $426 million or $0.41 per share, a year earlier.
Enbridge announced that its second quarter earnings were $393.0 million or $1.08 per common share, compared to $657.7 million, or $1.81 per share in the year-ago quarter. Shares were up 0.3% at $39.61.
Maple Leaf Foods added 0.3% at $8.98 after the company reported a second-quarter profit of $4.90 million or $0.04 per share versus a loss of $9.35 million or $0.07 per share a year earlier. Adjusted earnings per share were $0.12 compared with a loss of $0.01 in the prior year period.
Sherritt International Corp. declined 3.4% to $5.99 after the company said its second-quarter net earnings plummeted to $24.4 million or $0.08 per share from $80.3 million or $0.28 per share in the year-earlier period.
TMX Group declined 4.6% to $33.60 after the company posted second-quarter net income of $46.9 million or $0.63 per share, compared to $49.2 million or $0.65 per share in the last-year quarter.
Rogers Communications faded 2.4% to $31.10 after being downgraded To Sector Perform from Outperform at RBC Capital Markets. The target price was dropped to $34 from $39.
Brookfield Properties Corp. dropped 0.5% to $9.85 after the real estate investment firm reported a drop in second-quarter fund from operations, hurt by lower operating income at its Commercial property and Residential development operations.
For the second quarter, funds from operations of the Toronto-based company dropped to $148 million U.S. or $0.38 U.S. per share from $157 million U.S. or $0.40 U.S. per share in the same quarter a year ago.
The Canadian dollar slid 0.73 cents to 91.67 cents U.S.
ON BAYSTREET
Of the 14 TSX subgroups, nine finished the day negative. Metals and mining stocks slid 3.7%, global base metals were off 3.1%, while energy issues were down 2.7%.
Information technology’s 1.6% hike led the five gainers, followed by consumer staples, up 0.4% and consumer discretionaries, ahead a mere 0.2%.
The TSX Venture Exchange regained 3.63 points, to 1,131.74, while the Nasdaq Canada Index lagged 14.27 points to 735.93
ON WALLSTREET
In New York, stocks cut losses Wednesday, but remained in the red after a weaker-than-expected durable goods orders report added to worries about an economic recovery and Yahoo's partnership with Microsoft failed to rev up the tech sector.
The Dow Jones Industrials stumbled 26 points to 9,070.72. The S&P 500 index lost 4.47 points lower to 975.15. The tech-rich Nasdaq composite shed 7.75 points, to 1,967.76.
In addition to the day's news, Wall Street was also vulnerable to a pullback in the wake of a big two-week rally that lifted the Dow and S&P 500 by more than 11% and the Nasdaq by 12%.
The rally was sparked by a series of better-than-expected quarterly results. But with more than half of the S&P 500 companies yet to report, investors are showing a little caution.
Microsoft and Yahoo, the tech bellwethers, have finally completed a 10-year search deal that takes aim at Google's dominance in the online market.
Yahoo will use and promote Microsoft's Bing search engine on its site. In exchange, the company will keep 88% of the revenue from all search ad sales for the first five years. Yahoo will also have the right to sell ads on some Microsoft sites.
However, investors expressed some disappointment that Yahoo will not receive an upfront payment, sending its shares down by 11%.
Microsoft attempted to buy Yahoo outright for $47.5 billion U.S. last year, but was rebuffed by the company. Microsoft shares gained 1% Wednesday.
Oil stocks declined in tandem, with Dow components Chevron and Exxon Mobil both slipping.
Time Warner reported weaker quarterly earnings that beat estimates on weaker revenue that missed estimates. Shares fell 2%.
Sprint Nextel reported weaker quarterly sales and earnings as subscribers continued to decline. Shares fell 9%.
On the economic front, the U.S. Census Bureau reported that durable goods orders fell 2.5% in June, which was much worse than expected.
The durable goods orders, which reflect manufacturing activity, were expected to slip 0.6% for the month of June, according to a Briefing.com consensus, compared to an increase of 1.3% in May.
The Federal Reserve released its periodic "beige book" survey of economic conditions in its 12 districts. The report showed that economic activity remained weak -- but for most districts, the pace of the decline has slowed.
Stocks showed little reaction to the report.
Treasury prices were slightly ahead to end the day, lowering the yield on the benchmark 10-year note to 3.66%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil plummeted $3.88 to $62.90 U.S.
Gold prices were off $12 to $930 U.S. an ounce.
