The Toronto stock market was lower Wednesday amid reminders of the slow pace of global economic activity and lower-than-expected earnings from the Bank of Montreal.
The S&P/TSX Composite Index dropped 73.58 points to greet noon at 12,676.93
The Canadian dollar took on 0.29 cents to 96.44 cents U.S., as the Bank of Canada kept its trendsetting rate at 1% -- where it’s been since September 2010 – adding in its statement the economy did better than expected in the first quarter of 2013.
BMO Financial Group earned a second-quarter profit of $975 million or $1.42 per share, down from $1.03 billion or $1.51 per share a year ago, while its adjusted profit for the quarter was $997 million or $1.46 a share, three cents short of estimates. The bank's shares fell $1.42 or 2.2% to $62.28.
The glum economic outlooks depressed commodity prices as July copper on the New York Mercantile Exchange slipped three cents to $3.29 U.S. a pound, pushing the mining sector down 1.2% Teck Resources declined 57 cents to $27.65 while Turquoise Hill Resources was off 12 cents to $6.96.
The energy sector was lower as EnCana Corp. dropped 29 cents to $19.94.
The financial sector was also a weight as Scotiabank gave back 57 cents to $59.04 after the Bank of Canada's announcement did nothing to weaken the view that interest rates aren't going up until well into 2014 at the earliest.
The gold sector advanced, as Iamgold gained 14 cents to $5.33.
Internationally, the slow pace of economic activity was front and centre Wednesday morning after the Organization for Economic Cooperation and Development said that the recession in Europe risks threatening the world's economic recovery.
In its half-yearly report, the OECD said the U.S. economy will continue to outpace Europe, with growth of 1.9% in 2013 and 2.8% in 2014. It projects Canada's growth will be slower than the United States, with a 1.4% advance this year and 2.3% next year.
ON BAYSTREET
The TSX Venture Exchange dipped 4.72 points to 949.69
All but two of the 14 Toronto subgroups were lower by noon. Real-estate issues stumbled 1.8%, while utilities dipped 1.2% and the metals and mining group fell 1.1%.
The two gainers were gold, up 1.6%, and materials, up 0.6%.
ON WALLSTREET
U.S. stocks sold off Wednesday as optimism about the economy was overshadowed by ongoing concerns the Federal Reserve could curtail its bond buying.
The Dow Jones Industrials dumped 125.82 points midday to 15,283.60.
The S&P 500 index skidded 13.01 points to 1,647.05. The tech-rich NASDAQ Composite faded 22.91 points to 3,465.97
The Dow closed at a record high Tuesday as investors cheered upbeat reports on home prices and consumer confidence. But concerns that the Fed could scale back its stimulus policies as the economy improves weighed on the market Wednesday
Smithfield Foods shares surged 25% after the pork processor and hog producer agreed to be bought by Chinese meat processor Shuanghui International in a deal valued at $7.1 billion U.S.
The news lifted shares of rival meat processor Tyson Foods.
Service Corporation, which provides "deathcare products and services," announced plans to buy rival Stewart Enterprises for $1.4 billion U.S. Shares of Stewart Enterprises surged in early trading. The deal between two of the larger players in the funeral business is subject to regulatory approval.
Apple shares were slightly higher after an appearance at the AllThingsD conference by CEO Tim Cook Tuesday evening. Cook was evasive about the company's product plans, saying only that the iPhone maker was looking for more "game changers" in its future and that he considered the wearable computing product segment "incredibly interesting."
Citigroup reached a settlement with the Federal Housing Finance Authority in a suit charging it deceived Fannie Mae and Freddie Mac when it sold the housing finance firms mortgage securities during the housing bubble.
Prices for the 10-year U.S. Treasury were down, raising yields to 2.16%, from Tuesday’s 2.14%. Treasury prices and yields move in opposite directions.
Oil prices moved lower $1.35 to $93.66 U.S. a barrel.
Gold prices was positive $8.50 to $1,387.40 U.S. an ounce
