Canada's main stock index dropped to a four-and-a-half-month low on Wednesday as concerns that the global economic recovery was losing steam and worries about a weak outlook for oil demand weighed on shares of energy producers.
Investors were also digesting a report on Tuesday from the International Monetary Fund that showed the agency cutting its global economic growth forecasts for the third time this year.
The S&P/TSX composite index sagged 95.72 points – off its lows of the morning -- to approach noon at 14,480.73
The Canadian dollar lost 0.07 cents at 89.44 cents U.S.
The benchmark TSX has been trading in negative territory in 12 of the last 14 sessions, and down more than 7% since hitting a record high last month.
Energy shares have been weakening since June, when the price of oil began a slump over concerns about weak demand and ample supply. The energy sector tumbled on Wednesday and had the biggest negative influence on the market.
Shares of energy producers slid, with the U.S. crude oil price down 2%. Suncor Energy tumbled 2.6% to $37.55, and Canadian Natural Resources Ltd lost 2.7% to $38.91.
The industrial group shed strength, with Canadian Pacific Railway giving back 2.2% to $226.40.
But financials advanced as Royal Bank of Canada gained 0.8% to $80.31, and Bank of Montreal climbed 0.6% to $81.88.
Economically speaking, Canada Mortgage and Housing reported the seasonally adjusted annualized rate of housing starts climbed to 197,343 units last month from an upwardly revised 196,283 units in August, topping analysts' forecasts for 196,100. August was originally reported as 192,368.
ON BAYSTREET
The TSX Venture Exchange faded 15.38 points to 839.45.
All but two of the 14 Toronto subgroups were lower midday, as energy stocks gave back 2%, industrials dipped 1.4%, and the metals and mining group backtracked 1.3%.
The two gainers were consumer staples, up 0.8%, and financials, up 0.3%.
ON WALLSTREET
The U.S. stocks were wavering between small gains and minute losses on Wednesday, a day after a bout of heavy selling drove the main benchmark down nearly 4% from its peak reached just last month.
The Dow Jones Industrials moved higher 36.18 points to 16,755.57, after Tuesday’s 200-point-plus dive.
The S&P 500 inched forward 2.69 points to 1,937.79. The NASDAQ index gained 2.74 points to 4,388.60.
The release of Federal Open Market Committee minutes due at 2 p.m. Eastern Time may provide direction to the markets, but some strategists believe not much will be revealed as the Fed has already been relatively transparent about its monetary policy intentions.
Investors appear reluctant to make big bets ahead of earnings season, which Alcoa unofficially kicks off after the market close
Yum Brands picked up 1.6% after a big selloff on Tuesday. The company’s profit and outlook missed estimates, and it slashed expectations for full-year growth in earnings per share.
Kraft Foods Group was up 0.5% after the food company said Tuesday it’s raising its quarterly dividend to 55 cents U.S. a share, from 52.5 cents U.S.
Costco Wholesale surprised with a 13% rise in profit on growth in same-store sales and higher sales from membership fees. Shares rose 1.9%.
Symantec Corp. could be looking at a split, Bloomberg News reported, citing persons with knowledge of the plans. Shares rose nearly 2%.
Prices for 10-year U.S. Treasuries eked lower, raising yields back to Tuesday’s 2.35%. Treasury prices and yields move in opposite directions.
Oil prices fell $1.41 to $87.44 U.S. a barrel.
Gold prices moved lower $4.90 to $1,207.50 U.S. an ounce.
