Toronto stock market slipped into negative territory toward the end of Wednesday’s session, with weakness across the board.
The S&P TSX Composite Index slipped 59.69 points on the day to 12,042.29
Economically speaking, the Bank of Canada raised its benchmark interest rate today and said the country’s recovery will be slower than it had projected because of a weaker outlook for the U.S. economy.
The bank raised its target rate for overnight loans between commercial banks to 1% from 0.75%, in line with analysts’ estimates Further increases would need to be "carefully considered" given uncertainty around the outlook, the BofC said today.
Even as it tightened lending conditions, the central bank acknowledged that the country’s economic growth will be more gradual than previously thought due to ongoing U.S. weakness.
Gold shares got bludgeoned, particularly Eldorado Gold Corp., which fell 15 cents to $20.03 after the company announced it will withdraw from a bidding contest with Goldcorp for Andean Resources Ltd.
Shares in Goldcorp lost 66 cents to $43.66, while Andean’s stock fell 22 cents or 3.4% to $6.17.
In the oil patch, shares in Suncor Energy Inc. slipped 23cents to $33.24 after the energy company said it has reached a deal to sell a number of its U.K. offshore assets for about $390 million to an affiliate of British company Dana Petroleum PLC.
The December copper contract gained three cents to $3.50 per pound U.S. Among metal stocks, shares in Teck Resources Ltd. prospered 51 cents or 1.3% to $39.25.
Among financial stocks, Bank of Montreal gained 96 cents to $60.11.
In corporate news, oil producer Bronco Energy Ltd. announced it has agreed to a takeover by Legacy Oil + Gas Inc. in a share-swap agreement. Shares in Bronco jumped 2.5 cents or 14.7% to 19.5 cents, while shares in Legacy added a nickel to $11.04.
Shares in junior miner Anatolia Minerals Development Ltd. fell 47 cents or 6% to $7.34 after the company said it has agreed to merge with Australia-based Avoca Resources Ltd. in a share-swap arrangement.
Publisher and commercial printer Transcontinental reported a third-quarter profit of $30.6 million versus $25.5 million in the same period a year ago. Revenues were $500.3 million, down about 1%. Shares in the company slid four cents to $13.13.
Grain handler and farm supplier Viterra Inc. said its third-quarter net income fell to $63.5 million, down 47% from the same time last year. Shares in the company added three cents to $8.53.
And shares in Iamgold Corp.lost $1.09 or 5.4% to $19.04 after the gold producer said it has appointed longtime energy industry player Stephen Letwin as president and CEO.
Elsewhere in the economy, Canadian building permits fell in July because of declines in industrial facilities and multiple-unit dwellings such as condominiums and apartments.
The total value of permits issues by municipalities decreased 3.3% to $6.4 billion, Statistics Canada said today in Ottawa. Economists predicted a 4.9% drop.
The Canadian dollar hiked 0.90 cents to 96.38 cents U.S.
ON BAYSTREET
All but four of the 14 TSX subgroups were lower on the day. Gold tailed off 1.6%, followed by health-care, down 1.2%, and telecoms, off 1.1%.
The four gaining groups were led by metals and mining, up 0.5%, while global base metals progressed 0.4% and industrials inched ahead 0.1%.
The TSX Venture Exchange turned downward 6.90 points to 1,588.06, but the Nasdaq Canada index improved 2.37 points to 576.74.
ON WALLSTREET
In New York, stocks rose but pared back gains from earlier in the session Wednesday, after a report from the 12 Federal Reserve districts showed widespread signs of slower economic growth.
The Dow Jones industrial average remained ahead 46.32 points to close at 10,387.01.
The S&P 500 index forged ahead 7.03 points to 1,098.87. The tech-rich Nasdaq composite index picked up 19.98 points to 2,228.87
Earlier in the day, stocks had risen higher, with the Dow posting an 86-point gain.
Stocks are coming off losses Tuesday, when all three major indexes fell more than 1% as investors worried that European banks are in worse shape than previously believed.
But those fears subsided a bit Wednesday morning after the Portuguese debt auction was met with healthy demand. Experts caution that concern about Europe's banks may have eased but the problems are far from disappearing.
As austerity measures take affect in several European countries and various data continue to point to slower economic growth globally, sovereign credit spreads have started widening again, nearing the levels they were at in the spring.
Wider credit spreads are a sign that funding government debt could become more challenging for debt-laden European countries, experts said.
Shares of BP surged more than 3% at the opening bell after Fitch upgraded the company's rating three notches.
The ratings firm said the upgrade "primarily reflects an end to the threat of further leaks from the Macondo well in the Gulf of Mexico."
Economically speaking, the U.S. Federal Reserve's Beige Book, a snapshot of economic conditions across the central bank's 12 districts, suggested the economy continued to grow between mid-July and the end of August, but with "widespread signs of a deceleration" compared with earlier periods.
A separate report from the Fed showed that consumer debt fell by $3.6 billion U.S. in July -- far less than the $5.25 billion U.S. decrease predicted by economists.
President Obama officially unveiled three new proposals aimed at bolstering the shaky economic recovery in a speech in Cleveland.
They include an estimated $200 billion U.S. in tax breaks for businesses that invest in new plants and equipment; a $100-billion U.S. extension of the business tax credit for research and development; and $50 billion U.S. over the next decade to improve roads, rails and other infrastructure.
Congress is not expected to pass the proposals soon.
Treasury prices fell, raising the yield on the benchmark 10-year Treasury note to 2.65% from 2.61% Tuesday. Treasury prices and yields move in opposite directions.
The price of a barrel of oil gained 48 cents to $74.57 U.S.
Gold prices eased three dollars to $1,257 U.S. an ounce.
