Canada's main stock index slipped on Wednesday after the Federal Reserve stuck with a withdrawal of monetary stimulus and dropped a guideline for when U.S. interest rates may eventually rise.
The Toronto Stock Exchange's S&P/TSX composite index ended down 34.94 points, at 14,334.04.
The Canadian dollar descended 0.81 cents at 88.98 cents U.S. The slide added to a drop Tuesday of more than two-thirds of a cent after Bank of Canada Governor Stephen Poloz said slower-than-normal growth may be the new norm.
Canadian equity losses were felt most sharply in several major gold-mining shares, which were already down on a stabilization in the Ukraine crisis, but somewhat neutralized by gains in Canadian Natural Resources and other oil and gas stocks.
Canadian Natural Resources was up 0.9% at $40.94.
Banks and telecoms companies, both well-known dividend plays, also featured in the list of top performers, with Rogers Communications Inc up 1.3% at $44.10 and Bank of Montreal gaining 0.4% to $72.63.
Barrick Gold Corp fell 3.4% to $21.78 and Goldcorp was off 2.7% at $30, with the gold miners falling with bullion prices on a mixture of Fed reaction and an easing of anxiety over the Ukraine crisis. Worries about Ukraine had recently added to gold's safe-haven appeal.
On the economic beat, Statistics Canada reported this morning that wholesale sales rose 0.8% to $50.0 billion in January, following a decline in December, with gains recorded in all subsectors except motor vehicle and parts.
Elsewhere, Jim Flaherty, the long-serving Conservative finance minister who helped steer the economy through the global financial crisis, resigned from the cabinet on Tuesday, leaving the country on track to balance its books by 2015. Energy Minister Joe Oliver has been named by Prime Minister Stephen Harper as Flaherty’s replacement.
ON BAYSTREET
The TSX Venture Exchange eased 0.08 points to 1,038.87
Nine of the 14 Toronto subgroups were down on the day, weighed mostly by gold, down 3.2%, while the metals and mining sector fell 1.9%, and materials dove 1.8%.
The five gainers were led by consumer staples, up 1.2%, while information technology issues jumped 0.9%, and consumer discretionaries hiked 0.4%.
ON WALLSTREET
Investors weren't too thrilled by what they heard from Janet Yellen during her first meeting in charge of the U.S. Federal Reserve.
The Dow Jones Industrial Average plummeted 114.02 points to 16,222.17
The S&P 500 index slid 11.48 points to 1,860.77. The NASDAQ demurred 25.71 points to 4,307.60
Stocks were relatively stable as Yellen started her press conference. But the Dow fell as many as 180 points before recovering after she said the Fed's stimulus program would most likely be finished by the fall and that a rate hike could come as soon as early 2015.
Prior to the press conference, the Fed said it will continue trimming, or tapering, its monthly bond buying program by another $10 billion, to $55 billion U.S. a month.
Those asset purchases, a policy known as quantitative easing, started at the height of the 2008 financial crisis to support the U.S. economy. Many experts say it also has been a key driver behind the bull market in stocks for the past five years.
In corporate news, home builders were among the biggest gainers. KB Home shares jumped after the company reported earnings that beat analysts' expectations.
Rivals Lennar Corporation, D.R. Horton, and PulteGroup also rallied. On Tuesday, the government reported that building permits, a sign of future construction, rose by 7.7% in February.
FedEx blamed "unusually severe winter storms" for quarterly earnings that came in below estimates. But the fact that snow would impact FedEx wasn't that big of a surprise, and shares of the shipping company fell only slightly Wednesday.
UPS reported a similarly poor profit last quarter due to the weather. Both stocks are in negative territory for the year. But one trader on
Shares of Orbitz tumbled 9% after the travel site operator was downgraded to a "sell" rating by analysts at Goldman Sachs.
First Solar shares soared 21% after the company said it plans to develop a solar power plant with General Electric as part of the two companies' partnership that was announced last year. The stock has soared 135% in the past twelve months.
Horizon Pharma surged after the biotech company said it was buying Dublin-based Vidara Therapeutics International for $660 million U.S. Biotechnology stocks have been on a tear this year, although some of the leading stocks have pulled back lately on concerns about valuations.
Prices for 10-year U.S. Treasuries staggered, raising yields to 2.77% from Tuesday’s 2.68%. Treasury prices and yields move in opposite directions.
Oil prices advanced 69 cents to $100.39 U.S. a barrel.
Gold prices shed $29 to $1,329.00 U.S. an ounce.
