Stocks in Toronto struggled back to the breakeven point Wednesday noon, amid suspense over whether European leaders could come to an agreement as to how to settle their collective debt.
The S&P/TSX Composite Index were still off 5.65 points to 12, 075.60 by lunch hour after drifting generally lower throughout the morning.
The Canadian dollar sagged 0.17 cents to 98.88 cents U.S.
Hopes for a resolution to the debt crisis dimmed as a split appeared to be developing on how to tackle the problem.
Sentiment got a late day boost Tuesday from a report that European leaders might create a second bailout fund to supplement the one they have already agreed to. The second fund would nearly double the capacity of Europe’s financial rescue programs, the Financial Times reported.
But Bloomberg News reported Wednesday that Germany was rejecting proposals to combine the bailout funds.
The TSX energy sector lost ground with Suncor Energy declined 20 cents to $30.67.
The base metals sector was also down as metal prices also backed off with the March copper contract down two cents to $3.56 U.S. a pound. Teck Resources was down 24 cents to $38.48.
Gold stocks advanced Kinross Gold added four cents to $14.
Financials also weighed on the TSX with Royal Bank down 38 cents to $48.12.
Bank of Montreal is hiring the head of Metrolinx, the agency that operates GO Transit for the Ontario government, as its chairman. The bank says Robert Prichard, also a former CEO at Torstar Corp., will take the position after serving as an independent director of BMO since 2000.
Prichard replaces David Galloway who is retiring. BMO shares fell 91 cents to $56.83 on top of a 3.5% slide Tuesday following a disappointing earnings report.
Laurentian Bank rose 14 cents to $43.71 as its fourth-quarter profit fell to $28.6 million, or $1.06 per share, from $32.5 million, or $1.24 per share a year earlier. Excluding one-time costs, adjusted earnings per share were up 6% to $1.31.
In other corporate news, Dollarama Inc. shares gained 64 cents to $40.96 after it reported that third-quarter net earnings grew to $41.8 million from $31.3 million a year ago. Sales increased 12.5% to $400.3 million, helped by its opening of 10 new stores in the period, or 51 stores since a year earlier.
Cenovus Energy Inc. plans to spend between $3.1 billion and $3.4 billion in 2012 as it pushes forward with the expansion of its Christina Lake oil sands project. That’s about 23% higher than its capital spending budget for this year. Its shares rose 25 cents to $32.82.
ON BAYSTREET
The TSX Venture Exchange fell 4.35 points to 1,538.34, while the Nasdaq Canada index backtracked 3.46 points to 390.38
The 14 Toronto subgroups were evenly split between gainers and losers. Consumer staples and consumer discretionary stocks were co-leaders, each picking up 0.5%, while health-care issues were 0.4% to the good.
The seven laggards were weighed by energy stocks, off 1%, global base metals, down 0.8% and information technology, sliding 0.6%.
ON WALLSTREET
In New York, stocks remained below breakeven Wednesday as investors scaled back expectations for a breakthrough solution to the euro-zone debt crisis at a key summit this week.
The Dow Jones Industrials gave back 3.79 points to 12,146.30, at midday.
The S&P 500 erased 4.70 points, to 1,253.77, while the Nasdaq Composite subtracted 11.73 points to 2,637.83
Shares of Citigroup fell after CEO Vikram Pandit said late Tuesday that the banking giant would lay off roughly 4,500 employees over the next few months.
Shares of retailer Talbots skyrocketed after it said it had received a bid from buyout firm Sycamore Partners.
Early Wednesday, retailer J.C. Penney announced it would buy a stake in home decor expert Martha Stewart's franchise, Martha Stewart Living Omnimedia. The retail giant said it would invest $38.5 million U.S. Shares of Martha Stewart Living rose 33% in early trading.
Shares of Monsanto rose after the agriculture company raised its fiscal first-quarter earnings-per-share guidance.
Apparel company Pacific Sunwear will report results after the closing bell, and is expected to post a loss of 14 cents U.S. a share after losing seven cents U.S. per share in the prior year.
European Union leaders will meet Thursday and Friday in Brussels to discuss closer political and economic coordination, as well as other measures to restore market confidence and stabilize the euro currency.
After meeting with his French counterpart in Paris, U.S. Treasury Secretary Tim Geithner sounded hopeful about European leaders' ability to enact fiscal reforms and boost economic growth.
Also on Wednesday, Geithner is scheduled to meet with French President Nicolas Sarkozy and Spanish Prime Minister elect Mariano Rajoy Brey. He will travel to Italy later in the day.
Meanwhile, the European Central Bank is widely expected to cut interest rates at its policy meeting on Thursday.
Economically speaking, the Federal Reserve will release data on consumer credit for the month of October later today. Analysts surveyed by Briefing.com expect October's consumer credit figure to stand at $7 billion U.S., down from $7.4 billion U.S. in September.
The price on the benchmark 10-year U.S. Treasury gained ground, pushing the yield down to 2.07%, from 2.09% late Tuesday. Treasury prices and yields move in opposite directions.
Oil for January delivery gave back 69 cents to $100.59 U.S. a barrel.
Gold futures for February delivery rose $7.80 to $$1,739.60 U.S. an ounce.
