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Commodities weigh on Toronto
Apr. 16, 2010 (Baystreet.ca) --
Bay Street stocks were lingering in the red in mid-morning deals Friday, amid easing commodities prices and on renewed concerns over the euro-zone debt issues. The S&P/TSX Composite Index had tumbled 135.56 points, or 1.1%, by noon to 12,075.96 Traders overlooked another batch of encouraging earnings reports from south of the border. Bank of America reported first quarter earnings of $0.28 per share, beating consensus estimates by a notable margin. Wednesday, JP Morgan reported first quarter net income of $0.74 per share, beating consensus estimates for a earnings of $0.64 per share. General Electric Co said Friday that excluding one time items it earned $0.21 per share in the first quarter, beating analysts' expectations for a net income of $0.16 per share. In the energy space, Petrobakken Energy shed 1.68% and Cenovus Energy dipped 1.49%. Among gold stocks, Eldorado Gold surrendered 2.0% and Jaguar Mining slipped 6.56%. Gold company Avion Gold lost 5.13% after it said it entered into an agreement with Canaccord Financial Ltd. to sell 35.80 million common shares for gross proceeds of $25.06 million. Gold explorer Alder Resources moved down 3.13%. The company said it plans to complete a non-brokered private placement financing of 12 million common shares at $0.25 per share, for gross proceeds of $3 million. Base metals stocks were also under the sellers' radar, with the index shedding 1.0%. Teck Resources gave in 2.22%. Ivanhoe Mines moved down 1.38%. Logistics technology solutions provider Descartes Systems Group trimmed 1.26%. The company's wholly-owned subsidiary, Dexxcartes bvba, completed the acquisition of Zemblaz NV. Meanwhile, financial stocks were marginally higher following an upbeat earnings from Bank of America. Bank of Montreal added 0.86% and RBC gained 0.54%. Space science products maker COM DEV International rose 0.67%. The company said it bought substantially all of the assets of Routes AstroEngineering, a privately-owned company specializing in the design and manufacture of advanced instruments for space science research applications. In economic news, Statistics Canada said manufacturing sales edged up 0.1% to $ 44.10 billion in February, with most of the sales increases in Western Canada and Ontario. Analysts were expecting the sales to edge up by 0.8%. The agency also said new motor vehicle sales increased 8.1% to 138,336 units in February. The Canadian dollar dipped 0.71 cents to 98.99 cents U.S. ON BAYSTREET All but two of the 14 TSX subgroups were lower at the lunch break. Metals and mining stocks plunged 2.9%, materials and energy 2% each. The sole gainers were information technology issues, up a mere 0.3%, while health-care stocks garnered 0.2%. The TSX Venture Exchange skidded 7.61 points to 1,671.89, while the Nasdaq Canada index eased 7.67 points to 801.14. ON WALLSTREET In New York, stocks tumbled Friday, led by financials, after the Securities and Exchange Commission charged Goldman Sachs with fraud related to how it marketed subprime mortgages. The Dow Jones industrial average faded 138.07 points, or 1.2%, to 11,006.50 The S&P 500 index lost 20.95 points to 1,190.72. The Nasdaq composite slipped 35.89 points to 2,479.80. News that the SEC has charged Goldman with fraud sent the firm's shares down 12% and also dragged on the broader financial sector, with the KBW Bank sector index losing 4%. Stocks closed modestly higher Thursday as investors shrugged off the latest jobless claims report and Google reported much better-than-expected earnings after the closing bell. Three top-tier companies reported results over the last 24 hours. General Electric stock fell more than 3% after it reported first-quarter earnings that beat Wall Street forecasts, but sales fell short of expectations. GE said net income fell 18% to $2.3 billion U.S., or 21 cents U.S. per share, in the first three months of 2010. Analysts at Thomson Financial had expected earnings per share of 16 cents U.S. The company said revenue fell 5% to $36.6 billion U.S. Analysts had forecast sales of $3.7 billion U.S. GE said it expects earnings to grow for the rest of 2010, though it may take more cost-cutting measures to improve profit growth even more. Bank of America stock fell more than 5% after it reported profit of 28 cents U.S. a share. Analysts had expected BofA to post earnings of nine cents U.S. per share. Late Thursday, Google said net income rose 38% from last year's first quarter. Operating income was $6.76 U.S. a share, topping analysts' estimates of $6.60 U.S. Google's stock fell more than 6%. On the economic front, the University of Michigan's consumer sentiment index slipped to 69.5 in mid-April from 73.6 earlier in the month. The reading was a surprise to economists, who forecast it would rise to 75. Elsewhere, the U.S. Commerce Department said the number of building permits issued during March, considered a gauge of future construction activity, rose 7.5% to a seasonally adjusted annual rate of 685,000 from February's revised 637,000 rate, which was much more than expected. The March tally was the highest since October 2008, when 729,000 permits were issued. Permits were up 34.1% versus March 2009. Housing starts rose to an annual rate of 626,000 during the month, up 1.6% from February's revised rate of 616,000. Housing starts were up 20.2% from the 521,000 rate in March 2009. March housing starts were the highest since November 2008 and were better than forecast. Economists had expected housing starts to increase to an annual rate of 610,000. Prices for U.S. Treasurys shot up sharply, with the yield on the 10-year note falling to 3.78% from Thursday's 3.85%. Bond prices and yields move in opposite directions The price of a barrel of oil tanked $2.62 to $82.89 U.S. Gold prices jettisoned $25 to $1,135 U.S. an ounce.