T.O. down, N.Y. inches up

Feb. 3, 2009 (Baystreet.ca) --

12:40 pm EST Equities continued somewhat mixed by the midday point Tuesday, although American stocks slowly found their way back into the positives.

The S&P TSX Composite Index was still down 55.73 points to 8,569.10. Despite the weak showing, analysts say it's still a big improvement from the typical market seen late in 2008.

TransCanada Corp. said fourth-quarter profit fell to $277 million from $377 million a year-earlier. It also boosted its dividend 6% to 38 cents per share. Its shares were off 77 cents to $32.62.

The TSX energy sector slipped, as sector heavyweight EnCana Corp. stepped back 69 cents to $54.19.

The financial sector was off slightly as Bank of Montreal rose 39 cents to $32.49 while Manulife Financial declined 22 cents to $20.23.

Scotiabank shares eight cents higher to $29.88 after it said it has nearly doubled its stake in Thailand's eighth-largest bank, buying another 24% for about $270 million. Scotiabank now holds 49% of Thanachart Bank, the regulatory limit for foreign ownership of Thai banks.

In the gold sector, Barrick Gold Corp. climbed 47 cents to $45.26.

The information technology sector moved down, with Research In Motion Ltd. down $1.04 to $68.48. There were also announcements of more cutbacks in Canada's forestry industry.

Tembec is closing mills – some for two weeks, some indefinitely – in British Columbia, Manitoba and Ontario as pulp and paper market conditions remain soggy. About 1,400 workers will be affected and its shares dropped 14 cents or 12.7% to 96 cents.

And Canfor Corp. said Monday it will reduce production by 83 million board feet by taking a two-week curtailment at its British Columbia and Alberta sawmills starting Feb. 9. The company said it will also remove the third shift at its Quesnel, B.C., operation effective Feb. 23, resulting in a further reduction of 100 million board feet on an annualized basis. Canfor shares dipped six cents to $6.70.

Mega Brands Inc. shares surged 45 cents or 115% to 84 cents as it announced a global licensing agreement with Microsoft Game Studios to make construction toys based on the new Halo Wars video game.

The Canadian dollar climbed 0.61 cents to $81.08 cents U.S.

BAYSTREET Of the 13 TSX sub-groups, 11 were to the bad by lunch time, information technology declining 1.5%, followed by gold, off 1.3% and utilities, down 1.0%.

The two groups making headway were metals and mining, ahead 0.6%, and industrials, up 0.3%.

The TSX Venture Exchange slid 10.56 points, to 862.26, while the NASDAQ Canada index was 5.82 points behind Monday's close at 542.98

ON WALLSTREET

The Dow Jones industrials index pulled ahead of Monday's close by 27.79 points, to 7,964.62. The Standard & Poor's 500 index increased 2.78 points to 828.22. The NASDAQ composite index tacked on 2.67 points to 1,497.10

There was a rare glimmer of good news from the U.S. housing sector. The National Association of Realtors said its seasonally adjusted index of pending U.S. home sales for pre-owned homes in December rose 6.3 per cent to 87.7 from an upwardly revised November reading of 82.5. That's better than the 82.3 reading economists expected.

Investors are also bracing for gloomy news when automakers release their January vehicle sales during the day.

Chrysler LLC sales chief Steven Landry says U.S. industry sales could drop as much as 35% in January to the lowest rate in 25 years.

Homebuilder D.R. Horton Inc. reported a loss for the most recent quarter that was narrower than analysts anticipated thanks to cost cuts. Results from food processor and ethanol producer Archer Daniels Midland Co. and drug maker Schering Plough also topped estimates.

However, Dow Chemical reported it lost more than $1.5 billion U.S. in the fourth quarter as sales dropped 23% to end one of its worst years on record amid a global slump.

Excluding certain one-time costs, its loss was 62 cents per share – but analysts expected a profit of six cents a share excluding one-time items.

Dow said sales fell to $10.9 billion, far below the $13.3 billion analysts were looking for but its shares were 58 cents higher to $11.63.

And telecommunications equipment maker Motorola lost $3.6 billion in the fourth quarter as it took massive non-cash charges for goodwill impairment and an increase in a deferred tax reserve.

Motorola also said it is suspending its dividend after sales tumbled and the company's chief financial officer is leaving.

Sales were down 26% to $7.1 billion U.S. and its shares fell 48 cents to $4.06 U.S.

Treasury prices rallied, lowering the yield on the benchmark 10-year note to 2.78% from 2.72% Monday. Treasury prices and yields move in opposite directions. Yields on the 2-year, 10-year and 30-year Treasurys all hit record lows last month.

The March crude contract in New York moved up 68 cents to $40.76 U.S. a barrel

The April bullion contract in New York moved down $2.80 to $904.40 U.S. an ounce.