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Jan. 26, 2010 (Baystreet.ca) --
Canadian stocks reeled under pressure Tuesday morning as falling commodity price may weigh on investors' sentiment. The prices of oil and bullion were reflecting a weak trend amid a strengthening U.S. dollar and worries over global economic growth.
The S&P/TSX Composite Index found itself trailing Monday's close by 40.78 points soon after the opening bell to 11,313.73.
Today, Standard & Poor's lowered its outlook on Japan's sovereign debt rating to negative from stable, while the British economy expanded only 0.1% sequentially in the fourth quarter of 2009, after contracting 0.2% in the prior quarter.
Energy stocks may be in play as the price of crude oil continued to move lower on anxiety over demand outlook and economic growth concerns. Royal Dutch Shell Plc. said it would slow down its future growth in Fort McMurray, Alberta, citing high costs in the oil sands.
Traders will look to crude oil inventories data from across the border, due later today, which could guide the price of oil in the near future.
Research In Motion could attract attention after Apple Inc. reported spectacular earnings, indicating demand for mobile phones is vibrant, despite the recent slump in the global economy.
Health-care company Diagnostics posted a fourth-quarter net loss of $0.06 per share, wider than $0.05 per share in the same quarter last year.
Book retailer Indigo Books and Music reported a 29% jump in its quarterly profits, prompting RBC to up its price target on the stock to $19 from $17.
Home improvement chain Rona Inc. said it plans adding more stores so as to increase its per-share earnings by 10% to 15% in the coming two years. Meanwhile, UBS upped its price target on the stock to $18 from $17.
Mineral property explorer Palladon Ventures said it has appointed Dale Gilbert as President and Chief Executive Officer, and to the board.
Print media service provider World Color Press is likely to be acquired by Quad/Graphics Inc. for roughly $1.3 billion to $1.4 billion, the Wall Street Journal reported.
Renewable energy company Ram Power Corp. said it has won two geothermal concessions in Chile, through its subsidiary, Polaris Energy Chile.
Mining company Galway Resources said it entered into a binding agreement to acquire a 100% interest in the Reina de Oro and Coloro properties in the centre of the historic Vetas Gold Mining District in Colombia.
The Canadian dollar skidded another 0.78 cents to 93.72 cents U.S.
ON BAYSTREET
All but four of the 14 TSX subgroups were lower at the outset. Metals and mining lost 1.9%, while global base metals stocks were off 1.3% and energy stocks slid 0.9%.
The four gainers were led by gold, up 0.8%, information technology, surging 0.7% and materials, gaining 0.4%.
The TSX Venture Exchange faded 21.73 points to 1,525.12, while the Nasdaq Canada index fell 7.85 points to 674.05.
ON WALLSTREET
In New York, stocks found an upward direction at the open Tuesday, despite concerns of a slowdown in China and ahead of the start of a two-day Federal Reserve meeting.
In the first hour of trading, the Dow Jones Industrials grew 38.17 to 10,235.03. The S&P 500 was 2.01 points better to 1.098.79, and the Nasdaq moved up 3.99 points to 2,214.79.
Wall Street managed slim gains Monday as investors took the view that the recent selloff was overdone. Also contributing was news that Ed Whitacre, the acting chief, was named permanent CEO of General Motors and a report showing existing home sales fell 16.7% in December.
But Wall Street appears set for another slump. Some experts said the markets are dogged by "uncertainty" and "volatility" in the face of earnings expectations for 2010 that might be higher than the corporations can deliver.
Also on Tuesday, investors around the world were hit by fresh concerns about growth in China.
In Asia, Japan's Nikkei dived 1.8%. Major European indexes fell in midday trading.
A two-day meeting of central bank policymakers gets underway Tuesday. The Fed is expected to leave rates unchanged at near zero.
Uncertainty over whether Fed chairman Ben Bernanke's term will be renewed continues to hang over markets.
Apple reported record quarterly revenue after U.S. markets closed Monday. The company's strong quarter was fueled by iPhone and Macintosh computer sales. The company is gearing up for its widely anticipated announcement of a new tablet computer on Wednesday.
Treasury prices gained, lowering the yield on the 10-year note to 3.61% from Monday's 3.63%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil climbed 60 cents to $74.65 U.S.
Gold prices inched up two dollars to $1,099 U.S.