The Toronto stock market was lower Monday as the impasse on raising the U.S. debt ceiling rattled investors while market heavyweight Research In Motion Ltd. weighed on the TSX as the BlackBerry maker announced big job cuts.
The S&P/TSX Composite Index dropped 58.68 points to conclude the session at 13,436
The Canadian dollar gained 0.35 cents to 105.71 cents U.S.
RIM is eliminating 2,000 jobs, or about one-10th of its workforce, as the company loses market share of its smartphone to Apple Inc.’s iPhone. The Waterloo, Ont.-based company said last month that its quarterly revenue could drop for the first time in nine years.
RIM stock fell $1.22, or 4.6%, to $25.25. Before Monday’s announcement, its stock had tumbled 52% this year.
The industrials sector was down with Bombardier Inc. down 18 cents to $5.94. Canadian National Railways made up 40 cents worth of strength to $75.32 ahead of the release of quarterly earnings after the market close.
The financials sector lost ground as Royal Bank shed 39 cents to $52.86 and TD Bank fell 50 cents to $80.26.
The energy sector lost territory as oil prices fell amid investor concern that the lack of an agreement among U.S. lawmakers to raise the country’s debt limit could also damage the global economy.
Cenovus Energy was down 10 cents to $38.06.
The base metals sector advanced as copper prices shook off early losses and the September contract was unchanged at $4.40 U.S. a pound. Teck Resources advanced 31 cents to $50.29.
The gold sector was down as Barrick Gold Corp. faded 57 cents to $47.05 while Goldcorp Inc. gained 90 cents to $50.57.
In other corporate news, Valeant Pharmaceuticals International Inc. said it has received approval from Health Canada for its insomnia treatment Sublinox. The approval allows Valeant to move towards marketing the drug in Canada and its shares declined 81 cents to $52.78.
ON BAYSTREET
The TSX Venture Exchange lost 22.97 points to 2,036.63, while the Nasdaq Canada index tailed off 12.64 points to 554.90
In Toronto, all but two of the 14 subgroups were lower on the day. Information technology dipped 1.6%, while gold suffered 1.2% and consumer discretionaries went south 1.1%.
The lone gainers were in the metals and mining group, up 0.5%, and energy stocks, inching up 0.02%.
ON WALLSTREET
In New York, investors are frustrated with Washington's stalemate over the debt ceiling, but instead of selling off stocks in a panic Monday, they mostly sat on their hands, watching Congress haggle.
The Dow Jones Industrials fell 88.36 points to end the day at 12,592.80, with 26 of its 30 components falling.
The S&P 500 dropped 7.59 points to 1,337.43. The Nasdaq Composite Index gave back 16.03 points to 2,842.80
The U.S. government is just eight days away from a possible default, after lawmakers failed to agree on a deal to raise the debt ceiling over the weekend.
If Congress doesn't raise the $14.3-trillion U.S. debt limit by next week, Americans could face rising interest rates and a declining dollar, among other problems. But investors continue to call Washington's bluff, and are optimistic a deal will be reached before the August 2 deadline.
Travelers Companies, Boeing and Bank of America were the biggest drags on the Dow, while Microsoft and Hewlett-Packard were among the handful of gainers.
U.S. stocks are coming off a mixed Friday session, as strong gains in the technology sector were offset by disappointing results from industrial conglomerate Caterpillar.
Shares of BlackBerry maker Research in Motion fell 4.3%, after the company announced it was laying off 2,000 employees.
ETrade's stock jumped 5.2% on talk that TDAmeritrade may consider a bid for the online brokerage. Late Friday, Etrade retained Morgan Stanley to look at strategic alternatives.
After the market close, investors will get results from chipmaker Texas Instruments and video rental company Netflix
The results from Netflix will be closely watched, in part due to massive run Netflix shares have had run this year -- up nearly 60%.
Analysts expect Netflix to post a profit of $1.12 U.S. a share, while Texas Instruments is expected to earn 53 cents U.S. per share.
Bond prices inched down Monday, pushing the yield on benchmark 10-year notes up to 3.00% from Friday’s 2.99%. Treasury prices and yields move in opposite directions
Oil for August delivery faded 70 cents to $99.17 U.S. a barrel.
Gold futures for August delivery hit a new intraday record of $1,624.30 U.S. before settling at $1,612.20 U.S. an ounce.
