The Toronto stock market fell back Monday as the clocked ticked toward a probable partial shutdown of the U.S. government, while traders took in major deal-making.
The S&P/TSX composite index got to within 3.15 points of breakeven to greet noon ET at 12,840.93, well off its lows of the morning.
The Canadian dollar gained 0.33 cents to 97.23 cents U.S.
The real estate sector advanced as Brookfield Property Partners LP announced wants to buy out other shareholders of Brookfield Office Properties Inc. in a stock-and-cash deal it valued at $5 billion U.S. Brookfield Property Partners, which already owns a 51% stake in Brookfield Office Properties, has offered one unit of Brookfield Property Partners or $19.34 U.S. in cash per BPO share.
Brookfield Property Partners says the deal will create one of the largest commercial property companies. Brookfield Office Properties shares ran ahead $2.76, or 16%, to $20.05 while Brookfield Property Partners units added 22 cents to $20.22.
The base metals sector declined while December copper was unchanged at $3.33 U.S. a pound. Teck Resources gave back 32 cents to $34.20.
The energy sector fell one per cent amid major deal-making in the component.
Pacific Rubiales Energy Corp. intends to buy Calgary-based oil and gas company Petrominerales in a proposed deal worth roughly $1.6-billion.
Petrominerales shareholders would be paid $11 per share plus they'll get one share of a new Brazil-focused exploration and production company called ExploreCo that will be based in Calgary.
Petrominerales shares jumped $4.10, or 53%, to $11.84 while Pacific Rubiales fell $1.25 to $20.29.
Worries about the economic impact of a U.S. government shutdown punished oil prices. Among energy prices, Canadian Natural Resources shed 31 cents to $32.13.
Prices also declined in the wake of data showing that Chinese manufacturing activity ticked up more slowly than expected in September.
A survey by HSBC Corp. showed that manufacturing activity expanded marginally this month, rising to 50.2 from August's 50.1. But it surprised analysts by coming in much lower than the 51.2 in a preliminary version earlier this month.
HSBC said the reading was still positive because although it expanded only slightly, it showed further improvement from July, when the index hit an 11-month low.
The gold sector was slightly lower as Kinross Gold faded six cents to $5.09.
On the economic calendar, Statistics Canada reported that its consumer price index grew 0.6% in July, recovering from a decline of 0.5% in June. The nation’s number-crunchers also reported that their industrial product price index gained 0.2% in August, while the raw materials price index hiked 0.9% during the same month.
ON BAYSTREET
The TSX Venture Exchange dipped 10.56 to 942.30
Eight 14 Toronto subgroups were lower by noon, weighed mostly by metals and mining stocks, down 1.2%, while global base metals and health-care each slid 1%.
Real-estate led the half-dozen gainers, taking on 2%, while gold advanced 0.7% and utilities were 0.2% brighter.
ON WALLSTREET
Investors were wringing their hands Monday morning over the latest wrangling in Washington, and in between, did a fair bit of selling.
The Dow Jones Industrials plunged 121.83 points to break for lunch at 15,136.40
The S&P 500 index faded 7.68 points to 1,684.07. The NASDAQ fell 9.71 points to 3,771.88
Despite Monday's slide, the three major indexes are still up between 15% and 24% for the year. The Dow and S&P 500 are up over 3% in September alone, and hit record highs just two weeks ago. All three indexes are up for the quarter, led by the NASDAQ, which has risen 11%.
Shares of Apple dropped more than 1% ahead of CEO Tim Cook's anticipated lunch meeting with activist investor Carl Icahn.
Social media stocks Facebook, Zynga, and LinkedIn fell Monday.
There is increased chatter that Twitter may file its financial statements with the Securities and Exchange Commission this week, although it's not clear if that will happen if the government shuts down.
Some investors believe that Twitter's upcoming initial public offering could steal some momentum from other social media stocks since it is assumed that Twitter's growth will be very strong.
J.C. Penney dipped sharply Monday morning before bouncing back. The retailer, which has been hemorrhaging money, announced last Friday that it had raised roughly $810 million through a public offering. Shares are trading near lows not hit since late 2000.
Prices for the 10-year U.S. Treasury were lower, boosting yields to 2.63% from Friday’s 2.61%. Treasury prices and yields move in opposite directions.
Oil prices ducked back 97 cents to $101.90 U.S. a barrel.
Gold prices gave back $8.30 at $1,330.90 U.S. an ounce.
