Feb. 10, 2009 (Baystreet.ca) --
10:30 am EST
It was a stumbling start to the final trading day of what's been a stumbling week for markets on both sides of the world's longest undefended border, financials doing their bit to weigh down Canadian equities.
The S&P TSX Composite Index took a beating in the opening minutes Friday, losing 138.77 points to 8,046.58.
Meanwhile, data showed falling prices in Canada and the U.S.
Statistics Canada reported the country's annual inflation rate edged lower to 1.1% in January from 1.2% the previous month, driven lower by falling gasoline prices.
The financial sector in both countries bore the brunt of early losses as investors worry that a string of programs announced by the Obama administration in the past two weeks won't be enough to pull the U.S. out of a deep recession.
In particular, investors have been disappointed over a lack of details contained in U.S. Treasury Secretary Timothy Geithner's bank bailout announcement last week.
The TSX financial sector sank, with Royal Bank down $1.39 to $26.54 and Manulife Financial lost 61 cents to $13.89.
Kingsway Financial Services Inc. said Friday its loss for the fiscal fourth quarter exceeded gloomy estimates released earlier this month, citing underwriting charges at one of its troubled U.S. subsidiaries and impairments to goodwill.
Kingsway, which focuses primarily on auto insurance, reported a loss of $360.4 million U.S., which widened year-earlier losses of $103.5 million. Its shares added three cents to $3.18.
The energy sector also lost ground as oil prices fell back from Thursday's 14% surge. Suncor Inc. declined $1.69 to $22.26 and EnCana Corp. stepped back 80 cents to $49.29.
The gold sector was ahead as nervous investors sent the price of gold close to the $1,000 U.S. level. Goldcorp Inc. rose $1.20 to $40.34.
Barrick Gold Corp. shares were up 59 cents to $46.49 after the company took a $773-million U.S. goodwill writedown while posting a fourth-quarter loss of $468 million. Full-year profit dropped to $790 million from $1.12 billion in 2007. Gold production in 2009 is projected between 7.2 million and 7.6 million ounces, lower than 2008 production of 7.66 million ounces.
Teck Cominco Ltd. shares were down 35 cents to $3.70 after the miner agreed to sell its 50% interest in the Williams and David Bell mines in northern Ontario for $65 million U.S. to an affiliate of Barrick. The sale is part of Teck's plan to sell non-core assets to pay down debt.
Shares in Tim Hortons Inc. ran ahead $2.55 to $31 even as the coffee shop chain said quarterly profit dropped to $69.1 million from $75.7 million a year earlier. Earnings were reduced by asset impairment charges related to store closures
Investors will be awaiting word from the Canadian divisions of General Motors and Chrysler as they submit their restructuring plans to government officials.
Overseas, General Motors Corp.'s Swedish-based subsidiary Saab went into bankruptcy protection Friday so the unit can be spun off or sold by its struggling U.S. parent, officials said.
The move comes after Sweden turned down GM's request for government help for Saab.
The Canadian dollar dipped 0.26 cents to 79.16 cents U.S.
BAYSTREET
Of the 13 TSX sub-groups, 10 started downward, financials off 5%, metals and mining losing 4.8% worth of ground and energy stocks down 3.6%.
Positive stocks were once again led by gold, ahead 3.2%, followed by materials, chugging forward 1.2% and consumer discretionaries, up 0.2%.
The TSX Venture Exchange dropped 0.41 points to 901.69 while the NASDAQ Canada index shed 16.01 points, to 419.29
ON WALLSTREET
The Dow Jones industrials index lost 98.37 points to 7,367.58, after yesterday's close plumbed six-year-plus lows. The Standard & Poor's 500 was off 10.37 points to 768.57, while the NASDAQ composite index faded 8.67 points to 1,434.15.
Economically speaking, U.S. consumer prices rose by 0.3% last month, the biggest monthly increase since a 0.7% rise in July. But inflation for the 12 months ending in January was zero.
U.S. home improvement retailer Lowe's says its fourth-quarter profit dropped 60% to $162 million U.S. as consumers spent less on items for their houses amid a deepening recession. The company also expects lower earnings this year.
The March crude contract in New York was down $2.40 to $37.08 U.S. a barrel.
The April bullion contract on the New York Mercantile Exchange up $20.50 to $997 U.S. an ounce.