The Toronto stock market dropped sharply Friday after energy and mining sectors took back major gains seen earlier in the week and data showed the U.S. economy was weaker than expected in the first quarter.
The S&P/TSX index dropped 137.93 points to greet noon at 12,191.58
The Canadian dollar strengthened 0.32 cents at 98.34 cents U.S.
The TSX was also pulled down by a decline in the financials sector with a decline, led by 1% share value drops by Royal Bank of Canada and AGF Management with stocks of $59.87 and $10.80, respectively.
The drops capped off a week of strong advances for these two sectors.
Base metals stocks led decliners as May copper moved down three cents to $3.22 U.S.
The energy sector slipped while pipeline and power company TransCanada Corp. reported net earnings below expectations. The company looking to build the Keystone XL pipeline said it had net income of $446 million or 63 cents each share in the first quarter.
Comparable earnings a year earlier were $370 million or 52 cents per share — two cents per share below the consensus estimate.
TransCanada said it expects its long-delayed pipeline to be in service in the second half of 2015 — months later than its previous estimate as the company continues to await U.S. government approval for the project. Its shares were down 90 cents of 1.8% to $48.86.
In the gold sector, Agnico-Eagle Mines Ltd. reported a sharp drop in its first-quarter profits compared with a year ago due to lower gold prices and higher costs.
The gold miner, which keeps its books in U.S. dollars, reported after markets closed Thursday that it earned $23.9 million U.S. or 14 cents per share in the quarter, down from $78.5 million or 46 cents per share a year ago.
Revenue for the quarter totaled $423.2 million, down from $474.1 million. Its shares were down 79 cents to $32.86.
The real estate sector was down as Brookfield Office Properties Inc. reported $275 million U.S. or 48 cents of net income in the first quarter.
That was down from a year earlier but BPO’s funds from operations, which are more closely watched by analysts, were up and three cents a share ahead of the consensus estimate. FFO was $189 million, or 33 cents per share, up from $154 million U.S. or 27 cents per share a year earlier. Its shares dropped 15 cents to $18.19.
No major Canadian economic data was released today.
ON BAYSTREET
The TSX Venture Exchange slid 3.30 points to 961.37
All but one of the 14 Toronto subgroups were lower at noon, weighed mostly by metals and mining stocks, down 4.5%, gold, off 3.5%, and materials, sliding 3.1%
Consumer staples proved the lone holdout, ahead 0.04%.
ON WALLSTREET
The latest reading on U.S. economic growth failed to excite investors Friday.
The Dow Jones Industrials dropped points to pause for noon at 14,698.50, with Hewlett-Packard pushing the index up.
The S&P 500 index shaved off 6.93 to 1,578.23. The tech-heavy NASDAQ Composite retreated 19.71 points to 3,270.28
Meanwhile, investors continue to monitor a mixed bag of quarterly earnings reports.
Chevron traded up on better-than-expected earnings.
D.R. Horton's stock price surged, after the home builder reported a near doubling of quarterly net income on Friday, riding the wave of the recovering housing market.
Burger King Worldwide rose after it reported an increase in profits.
Starbucks came under pressure after issuing downside guidance for the current quarter and reaffirming its revenue outlook for the year.
Amazon shares fell precipitously, after the online retailer reported a profit decline. Shares of the Chinese internet search firmBaidu dropped more than 8% on weak earnings.
Travel search engine Expedia also dropped more than 8% after it released earnings.
Meanwhile, J.C. Penney shares surged after hedge fund mogul George Soros said late Thursday that he had taken a 7.9% stake in the ailing retailer.
Economically speaking, the U.S. government said GDP grew at an annual pace of 2.5% in the first quarter. That fell short of the 2.8% economists were predicting and up from a measly 0.4% in the fourth quarter of 2012.
Prices on the 10-year U.S. Treasury grew, dropping yields to 1.67% from Thursday’s 1.71%. Treasury prices and yields move in opposite directions.
Oil prices faltered 86 cents to $92.80 U.S. a barrel.
Gold prices marched $7.10 to $1,469.10 U.S. an ounce
