TSX down Tuesday

Apr. 13, 2010 (Baystreet.ca) --

The Toronto stock market was sharply lower Tuesday morning as oil prices backed off for a fifth session on demand concerns and a warning that prices have run up too high recently. The S&P/TSX Composite Index surrendered 47.14 points to end the day of 12,101.52. The TSX energy sector dropped as Suncor Energy declined 35 cents to $34.83 while Canadian Oil Sands Trust shed 76 cents to $31.46. Prices have headed lower since the middle of last week on data showing rising inventories. On Tuesday, the IEA expressed concern that oil markets are "overheated." Other commodity stocks backed away amid weakening gold prices. The TSX global gold index faded as Barrick Gold Corp. was down 45 to $40.45 while Goldcorp Inc. lost 39 cents to $39.79. The base metals sector lost ground as Equinox Minerals stepped back 18 cents to $4.19 while Teck Resources dropped 51 cents to $44.93. Shares of junior miner Khan Resources Inc. fell 31 cents or 36.5% to 54 cents after the company announced that its Mongolian subsidiary and a joint venture have had their uranium mining and exploration licences invalidated. In other corporate news, shares in Viterra Inc., one of Canada's largest agribusinesses, were off seven cents to $9.28 after it said that it is selling its half-ownership in the Australian Bulk Alliance. A subsidiary of Japan-based Sumitomo Corp. is paying A$8.6 million, or about $7.9 million, to buy the remainder of the 50-50 Australian joint venture. Paramount Energy Trust said Monday it has agreed to sell three properties producing a total of roughly 370 barrels of oil equivalent per day for $34.1 million in cash and stock. Paramount said it will receive $26.5 million in cash from the sale that will be used to reduce debt and shares in an unidentified public oil and gas company valued at $7.5 million. Its shares ticked four cents higher to $4.81. Discount retailer Dollarama Inc. shares dropped 66 cents to $24.54 after it said Monday that a group of its shareholders have signed a deal for a secondary offering of the company's shares totaling $250 million. On the Venture Exchange, a major advancer was Mountain Lake Resources Its shares surged 15.5 cents or 36.4% to 58 cents, after earlier hitting a fresh 52-week high of 63 cents. The stock also made a strong advance last Thursday after it released drilling results from the Leprechaun gold deposit in central Newfoundland. In economic news, Statistics Canada said Tuesday the nation's trade surplus grew by a larger-than-expected $1.40 billion in February, as exports were up by 2.8% to $34.02 billion, while imports increased 0.9% to $32.62 billion. In other report, the agency said the price of Canadian new homes grew by 0.1% in February from the earlier month and was up by 0.9% year-over-year. The Canadian dollar gained 0.14 cents to 99.86 cents U.S. ON BAYSTREET All but two of the 14 TSX subgroups were lower. Metals and mining stocks weighed most heavily, 1.9%, followed by materials, off 1.2%, and health-care stocks, down 1.1%. Real-estate issues moved 0.6% higher, while industrials climbed 0.4%. The TSX Venture Exchange skidded 8.72 points to 1,664.95, but the Nasdaq Canada index moved 13.76 points higher to 797.52. ON WALLSTREET In New York, equities eked out slim gains Tuesday, with investors keeping the Dow industrials above 11,000, but showing caution after Alcoa's mixed profit report and a weaker dollar dragged on commodities. The Dow Jones industrial average stayed above the psychologically-important 11,000 mark, gaining 13.45 points to 11,019.42. The S&P 500 index added 0.82 points to 1,197.30, while the Nasdaq composite gained 8.12 points to 2,465.99. Select stocks led the mild advance, with consumer and other economically sensitive shares rising. Home Depot, McDonald's, 3M and General Electric were among the Dow's bigger gainers. But any advance was limited by weakness in financial shares, with the KBW Bank index losing 1%. Alcoa shares were down 3%, and commodity prices and shares slipped. The Dow closed above 11,000 Monday after European leaders made $40 billion U.S. in loans available to debt-strapped Greece, should the nation need it. Greece's inability to borrow at low rates has raised fears it might default on its debt. But the loan package eased those fears and the euro nation's sale of short-term notes Tuesday drew strong demand. Investors have been worried that Greece's problems will destabilize the euro and rattle the other debt-burdened PIIGS, Portugal, Italy, Ireland and Spain. Regardless of these worries, stocks have been on the rise lately, with the major gauges all advancing in seven of the last eight weeks on bets that the economy won't fall into a double-dip recession. Optimism about the quarterly reporting period has also fed stock gains. The aluminum producer Alcoa reported a quarterly profit late Monday of 10 cents U.S. per share versus a loss of 59 cents U.S. per share a year ago. The gain was in line with a consensus of analysts surveyed by Thomson Reuters. But Alcoa's revenue missed expectations. The Dow component reported revenue of $4.89 billion U.S. versus forecasts for $5.238 billion U.S. Alcoa's sales topped $4.147 billion U.S. a year ago. Intel reports results after the close. The tech leader and Dow component is expected to have earned 38 cents U.S. per share versus 11 cents U.S. per share a year ago. S&P 500 earnings are expected to have risen 37% versus a year earlier, when the financial crisis hit its nadir and earnings plunged 40%. Revenue is expected to have risen 10% versus a year ago. JPMorgan Chase, Bank of America and Google are the other big names due later in the week. Shares slumped 14% in active trading following reports Monday that the troubled company Palm has hired Goldman Sachs and Qatalyst Partners to try and find it a buyer. Palm shares had gained 17% Monday. Economically speaking, the government reported a larger-than-expected increase in the U.S. trade gap for February. The nation's international trade deficit in goods and services increased to $39.7 billion U.S. in February from a revised $37 billion U.S. in January, the Commerce Department said. Economists surveyed by Briefing.com were expecting the gap to widen to $38.5 billion U.S. The deficit expanded as exports totaled $143.2 billion U.S., while imports reached $182.9 billion U.S. The benchmark 10-year U.S. Treasury note rose, driving the yield down to 3.81% from Monday's 3.85%. Bond prices and yields move in opposite directions. The price of a barrel of oil slid 30 cents to $84.05 U.S. Gold prices moved down $10 to $1,153 U.S. an ounce.