The S&P/TSX composite index closed lower today -- down 38.39 points to 11,714.51 -- as investors took a step back from the previous session's rally and turned their attention to Washington were the senate is rumored to vote later tonight on a revised version of the $700 billion bailout package.
In corporate news -- United States regulators gave Canadian Pacific Railway Ltd. the green light yesterday to take control of Dakota, Minnesota & Eastern Railroad Corp., which could eventually bring a third railroad to lucrative Western U.S. coal fields.
The Surface Transportation Board said the US$1.5 billion acquisition, announced last year, would not lessen competition in the rail industry and no shippers would lose the option of competitive services because of the takeover.
As for US economic data -- Automatic Data Processing's September private nonfarm employment figures showed a loss of 8,000 jobs, far better than economists' estimates for a decline of 50,000. ADP revised its August lost-jobs count to 37,000 from a previous read of 33,000.
The Institute for Supply Management's manufacturing index for September came in at 43.5, below the 49.5 anticipated by economists and down from 49.9 in August. The Commerce Department's reported that construction spending was flat for August, better than an expected decline of 0.5 percent.
The Canadian dollar, meanwhile, was trading up 0.02 cent to 94.22 cents US after losing almost three cents since the weekend.
BAYSTREET
Eight of the TSX sub-groups traded higher today -- utility stocks were up 3.38 percent followed by a 3.43 percent gain in telecom issues and a 1.77 percent rise in gold issues.
COMEX gold for December delivery rose $6.50 to $887.30 US an ounce. Like oil, gold prices rallied during the biggest periods of unrest over the last few weeks.
On the downside -- mining stocks were off 3.72 percent; energy issues fell 2.67 percent and industrial stocks shed 1.50 percent.
Meanwhile, the TSX Venture Exchange was off 8.35 points to 1,406.65 while NASDAQ Canada stocks were off 10.90 points at 694.58.
ON WALLSTREET
Stocks fell slightly Wednesday, with investors entering the first session of the fourth quarter still on edge over whether Congress will pass the controversial $700 billion financial-sector bailout package.
The Dow Jones Industrial Average, which had been down some 218 points earlier, ended the day off 19.59 points, or 0.2 percent, at 10,831.07, and the S&P 500 lost 5.3 points, or 0.5 percent, at 1161.06. The Nasdaq gave back 22.48 points, or 1.1 percent, to 2069.4.
General Electric Co. was off 2.7 percent, off earlier lows, after saying it will sell $12 billion in common stock in a secondary offering and sell $3 billion in preferred shares to Warren Buffett's Berkshire Hathaway Inc.
Investors were still waiting for news on a $700 billion financial-sector bailout proposal rejected by the House of Representatives on Monday.
The revised bill before the Senate includes a temporary increase in the Federal Deposit Insurance Corp.'s insurance on bank deposits to $250,000 from $100,000. The bill also extends existing tax breaks for individuals and businesses for two years.
The bill also will temporarily let the FDIC borrow unlimited funds from the Treasury to further bolster its insurance of U.S. deposits. Such a move could help alleviate strains on banks, as depositors have increasingly reduced deposit levels to the current $100,000 FDIC insurance limit.
In corporate news -- Bloomberg reported that Swiss bank UBS may be cutting as many as 1,900 investment banking, equities and fixed-income jobs. UBS announced earlier this year that it would split its business after incurring large subprime-related writedowns.
Longer-term U.S. Treasuries were rising in price. The 10-year note was up 25/32 to yield 3.73 percent, and the 30-year was gaining 1-28/32, to yield 4.2 percent. The American dollar was stronger vs. its major foreign competitors.
U.S. light crude oil for November delivery fell $2.11 to settle at $98.53 US per barrel on the New York Mercantile Exchange.
The Energy Information Administration says crude inventories rose by 4.3 million barrels to 294.5 million barrels for the week ending Sept. 26. Analysts had expected crude stocks to rise or fall by 1.5 million barrels, according to a survey by energy research firm Platts.
