The Toronto stock market dipped back into negative territory near midday in a wavering trading session characterized by concerns about the global economy.
The S&P/TSX Composite was lower by 14.50 points to break for lunch at 12,174.14
The Canadian dollar gathered 0.09 cents to 97.35 cents U.S.
In corporate news, Canada's largest publicly traded miner Teck Resources Ltd. is moving to solidify its position in the oil business, offering more than $435 million for its oilsands partner SilverBirch Energy Corp.
The transaction is valued at $8.50 cash for each SilverBirch share plus one share of a new company, to be called SilverWillow Energy Corp. Teck shares dropped 75 cents to $37.60.
In other corporate developments, Canadian Pacific Railway Ltd. is standing by its chief executive officer, saying its board of directors has unanimously decided it's "not in the best interests" of CP or its shareholders to replace Fred Green.
The CEO has been targeted for removal by an American financier who controls nearly 15% of the company's outstanding stock. He wants the former CEO of Canadian National to take the leadership role.
A new report from the Bank of Canada said that businesses pessimism is on the rise with confidence notably lower than the highs reached after Canada emerged from recession in mid-2009.
More businesses responding to the Bank of Canada survey said they are discouraged about future sales prospects, with more companies expecting slower sales this year. That's the first decline in nearly three years, the bank said.
Economically speaking, Statistics Canada reported this morning that building permits skidded 3.6% to $6.1 billion in November, after a jump of 11.6% in October. A decline in the non-residential sector, particularly in Ontario, more than offset gains in the value of residential permits.
ON BAYSTREET
The TSX Venture Exchange added 6.30 points to 1,532.03, while the Nasdaq Canada index slumped 0.51 points to 380.96
Seven of the 14 Toronto subgroups were ahead by noon hour. Health-care issues progressed 1.3%, while gold gained 0.6% and materials garnered 0.3%.
The six laggards were weighed by metals and mining, off 0.5%, consumer staples and telecoms were off 0.4% each. Information technology stocks were flat at midday.
ON WALLSTREET
In New York, equities drifted between small gains and losses Monday, as cautious investors continued to keep a close eye on events in Europe and geared up for the start of corporate earnings season.
The Dow Jones Industrials were up only 6.89 points to 12,366.80
The S&P 500 slipped 0.62 points to 1,277.19, while the Nasdaq Composite was behind 1.33 points to 2,672.89.
Aluminum producer and Dow component Alcoa will kick off the quarterly reports season after the closing bell. Analysts expect a modest sales increase and a big profit drop.
Overall, earnings for companies in the S&P 500 are expected to be up 7.5% in the final three months of 2011, versus the same period in 2010, according to research from S&P Capital IQ.
Novartis shares slipped after the Swiss pharmaceutical company recalled bottles of over-the-counter drugs, including Excedrin and Bufferin, because of complaints about mislabeled and broken pills.
Netflix shares rose after CEO Reed Hastings told Reuters that the company began gaining back U.S. subscribers in the fourth quarter of last year. That said, he still doesn't expect the company to turn a profit in 2012. Netflix also launched its service in the United Kingdom and Ireland on Monday, going up against Amazon-owned rival Lovefilm.
While earnings are expected to have increased last quarter, investors remain nervous about the debt crisis in Europe.
On Monday, German Chancellor Angela Merkel and French President Nicolas Sarkozy said that progress has been made on a proposed intergovernmental pact to increase fiscal discipline across the euro-zone. The leaders added that the pact could be signed ahead of the Jan. 30 E.U. summit and go into effect as early as March.
Early Monday, a €3.9-million auction of six-month German bills drew strong demand, pushing the yield to a negative 0.0122%. German bonds are considered a safe haven, so the strong demand reflects the ongoing investor worry surrounding Europe's debt crisis.
Italy and Spain are set to hold the first bond auctions of 2012 later this week.
In another sign of nervousness, euro-zone banks parked an all-time high of €463.5 billion in the European Central Bank's overnight deposit facility Friday. European banks don't get much in return by lending to the E.C.B.; they use the central bank's deposit facility in lieu of lending to each other at higher rates in times of uncertainty.
On the economic front, the Federal Reserve will release data on consumer credit for the month of November Monday afternoon. Analysts surveyed by Briefing.com expect consumer credit to have increased by $7 billion U.S., after increasing by $7.6 billion U.S. in October.
Treasury prices for the 10-year note were higher, dropping yields to 1.93% from Friday’s 1.96%. Treasury prices and yields move in opposite directions.
Oil for February delivery demurred 64 cents to $100.62 U.S. a barrel.
Gold futures for February delivery added $2.70 to $1,619.50 U.S. an ounce.
