Stumbling finish for stocks

Feb. 10, 2009 (Baystreet.ca) --

04:33 pm EST Equity markets limped to the finish the Friday before a long weekend in both Toronto and New York, in part due to apprehension that a remedy for the world financial system may not be at hand.

The S&P TSX Composite Index finished a wild week down 109.02 to 8,669.72.

Toronto markets are closed for the Family Day holiday Monday.

Investors are hopeful that economic leaders from the United States, Canada, Japan and other industrialized nations will come up with clear, specific ways to repair the global financial system at their meeting this weekend.

Officials from the Group of Seven, gathering in Rome on Friday, plan to discuss new rules for financial markets, as well as concerns about protectionist measures in stimulus plans.

Investors have been discouraged most of the week since U.S. Treasury Secretary Timothy Geithner revealed plans to assess financial institutions' health and remove their toxic assets with the help of private investors - but gave few details about how the process would work. The market did not respond enthusiastically, either, to the $789-billion U.S. economic stimulus plan agreed to by Congress.

A 74-seat Q400 Bombardier aircraft operated by Manassas, Va.-based Colgan Air crashed into a house just outside Buffalo, N.Y. Thursday night, killing all 49 people aboard and a person in the home. It was first fatal crash of a commercial airliner in the U.S. in 2 1/2 years.

Bombardier Inc. has dispatched a team to the crash site and its shares were down 22 cents to $3.31.

Desjardins maintained its "buy" rating on the stock with a $6.50 target price.

The Toronto market's energy sector rose as oil prices headed higher after closing Thursday at a two-month low. EnCana Corp. gained $1.20 cents to $54.61.

The market also found support from the base metals sector, with First Quantum Minerals ahead $2.30 to $31.15.

NovaGold Resources Inc. and Teck Cominco Ltd.have a new agreement for funding their stalled Galore Creek copper-silver project in northwestern British Columbia. Nova Gold shares were up nine cents to $4.42 while Teck shares gained eight cents to $5.08.

The gold sector was down. Barrick Gold Corp. faded $1.29 to $47.24.

Research In Motion Ltd. was also a weight on the TSX. Its shares fell $3.33 to $59.72, wiping out most of Thursday's gain. The stock took a 15% hit Wednesday after it said its fourth-quarter profits will come in at the lower end of the company's previous guidance.

The fall came as Credit Suisse analyst Kulbinder Garcha cut his rating on the BlackBerry maker to under perform from neutral. He also slashed his earnings expectations for the February 2010 fiscal year and reduced his price target to $37 U.S. from $45. U.S.

The financial sector was down with Royal off 44 cents to $30.30 while Scotiabank moved down 38 cents to $29.57.

Manulife Financial Corp. shares were down 50 cents to $17.70 after losing $1.16 Thursday following a report by the company that it lost $1.87 billion in the fourth quarter - even worse than the $1.5-billion loss estimated in early December.

On the earnings front, Air Canada shares tumbled 44 cents or 22.8% to $1.49 after the airline said Friday volatility in both fuel prices and foreign exchange rates drove 2008 financial results into the red for both the fourth-quarter and full year.

Air Canada reported a fourth-quarter loss of $727 million, reversing year-earlier profits of $35 million.

Soaring fuel prices took a toll on Air Canada's full-year financial results as well, prompting the company to report a loss of $1.03 billion, reversing year-earlier profits of $429 million.

Jacques Kavafian at Research Capital has slapped a "sell" rating on the stock with a 25-cent target.

Telus Corp. fourth-quarter profits were down 29% to $285 million and its shares declined 40 cents to $34.64.

Oil and gas pipeline firm Enbridge Inc. reported Friday a fourth-quarter profit of $263.4 million, up 6% from the year-earlier quarter, with a boost from a stronger U.S. dollar. That was up from $248.6 million a year ago and its shares rose 13 cents to $41.73.

The Canadian dollar gained 0.63 cents to 81.01 cents U.S.

BAYSTREET Of the 13 TSX sub-groups, nine were lower, gold's 2.8% drop the biggest, followed by information technology, behind 2.7% and financials, down 1.9%

The four groups that were ahead were led by metals and mining, up 1.9%, real-estate, ahead 0.8%, and consumer staples, up 0.5%.

The TSX Venture Exchange picked up 9.77 points to 925.64 while the NASDAQ Canada index lost 13.50 points, to 494.44

ON WALLSTREET

The Dow Jones industrials index plummeted 82.35 to 7,850.41. The Standard & Poor's 500 index tailed off 8.35 points to 826.84, while the NASDAQ composite index was still 7.35 behind at 1,534.36

Stateside, one trader opined that investors appear to be "lightening up" and unloading their less desirable stocks before they head into a long weekend. U.S. markets are closed Monday for Presidents Day.

Friday's one economic report was the University of Michigan's February consumer sentiment index. The index weakened by more than expected, falling to 56.2 from 61.2 in the previous month. Economists surveyed by Briefing.com thought it would dip to 60.2.

That was the lowest since November, when U.S. stocks hit 11-year lows during one of the worst periods of the current financial crisis. A separate reading in the report showed consumer expectations fell to their lowest since May 1980.

Treasury prices tumbled, raising the yield on the benchmark 10-year note to 2.89% from 2.79% Thursday.

The March crude contract on the New York Mercantile Exchange gained $3.42 to $37.40 U.S. a barrel.

The April bullion contract on the Nymex was down after three days of increases, off $7 to $949.20 U.S. an ounce.