Metals weigh TSX
Apr. 27, 2010 (Baystreet.ca) --
Bay Street stocks may struggle to sustain gains Tuesday morning amid easing commodities prices and on renewed worries over the Greece debt situation.
The S&P/TSX Composite Index dipped 10.21 points to begin the trading day at 12,270.76.
Concern that an aid package will not fully suffice the Greek debt crisis pressured the euro in morning deals. Last Friday, Greece said it will opt for bailout loans from the euro-zone and the IMF.
Apart from a weaker euro, China's steps to cool its property markets also weighed on commodities prices.
However, encouraging earnings reports from south of the border may help lift sentiment.
Meanwhile, earnings reports from Canadian companies came in mixed, with CN Rail beating estimates and Nexen missing estimates.
In corporate news from Canada, CN Rail reported improved first quarter net income of $1.08 per share, compared to $0.90 per share in the year-ago quarter. For 2010, the company continues to expect solid double-digit growth in adjusted earnings per share over last year.
Results for the quarter also included an after-tax gain of $131 million or $0.28 per share, from a rail-line sale to a Toronto-area transit agency.
Energy company Nexen Inc. reported first-quarter net income of $0.35 per share, up from $0.26 per share in the same quarter last year. It also declared quarterly dividend of $0.05 per common share. Analysts were expecting the company to post $0.38 per share.
Inmet Mining reported first-quarter net income of $1.42 per share, compared to $1.06 per share last year.
Gold miner Kinross Gold said it has upped its stake in Underworld Resources Inc. to nearly 81.6%. Kinross also intends to de-list the Underworld shares from the TSX Venture Exchange on completion of a subsequent acquisition transaction.
Nuukfjord Gold shares will commence trading on the TSX on April 27 under the trading symbol "NUU". The company offered 18 million common shares at $0.50 per share, aggregating gross proceeds of $9 million.
Wood based panel maker Norbord Inc. reported a narrower first-quarter net loss of $0.12 per share, compared to $0.52 per share last year.
In economic news, the Conference Board's index of consumer confidence dropped to 84.8 in April, erasing the gain recorded in March.
The Canadian dollar slid 0.63 cents to 99.24 cents U.S.
ON BAYSTREET
Of the 14 TSX subgroups, eight were negative to begin the trading day. Global base metals sank 1.5%, metals and mining tailed off 1.1%, and industrials slid 0.7%.
Among the gainers, telecoms fared the best, raising themselves 0.7%, health-care stocks were 0.3% stronger, and consumer discretionary stocks nipped up 0.2%.
The TSX Venture Exchange subsided 8.38 points to 1664.47, while the Nasdaq Canada index picked up 2.86 points to 805.94
ON WALLSTREET
In New York, stocks inched lower Tuesday ahead of Goldman Sachs' testimony on Capitol Hill and the start of the two-day Federal Reserve policy meeting.
The Dow Jones industrial average took off 18.21 points to open the day at 11,186.82.
The S&P 500 index faded 4.66 points to 1,207.39. The Nasdaq composite index gave back 9.41 points to 2,513.54.
Better-than-expected results from Texas Instruments, DuPont and 3M helped temper the selling.
U.S. markets finished little changed Monday as investors had difficulty finding momentum after pushing stocks higher for eight straight weeks.
Investors remained cautious as central bank policymakers get ready to begin get their two-day policymaking meeting Tuesday.
The Fed's closely scrutinized statement comes out at the conclusion of the meeting Wednesday afternoon. No change is expected in the historically low interest rates near zero percent, but investors will look for comments on the state of the economy and how the central bank will begin to tighten its accommodative policy.
On the economic front, investors will take in reports on home prices and consumer confidence.
The Case-Shiller 20-city home price index rose 0.6% in February versus a year earlier, the first rise on an annual basis in three years. However, economists surveyed by Briefing.com were expecting a bigger gain of 1.1%. Prices fell 0.7% in January.
Consumer confidence surged in April, according to the Conference Board, whose index rose to 57.9 from 52.3 in March.
Shares of Ford Motor fell, despite the company's better-than-expected first-quarter results.
The automaker posted net income of $2.1 billion U.S., or 50 cents U.S. per share, for the first quarter of 2010. Analysts surveyed by Thomson Financial had expected earnings per share of 31 cents U.S.
CIT Group, a bank specializing in small business financing, said it earned $97 million U.S., or 49 cents U.S. per share, in the first quarter.
After the market closed Monday, Texas Instruments posted a 35% rise in first-quarter sales. The company said it earned net income of $658 million U.S., or 52 cents U.S. per share, on sales of $3.21 billion U.S.
3M and DuPont also reported better-than-expected results.
Meanwhile, investors will be keeping an eye on a hearing on Capitol Hill where top executives from Goldman Sachs are expected to face tough questions in relation to the civil fraud charges brought against the firm by the Securities and Exchange Commission.
Treasury prices jumped, sharply lowering the yield on the 10-year note to 3.76% from Monday's 3.82%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil slipped 70 cents to $83.50 U.S.
Gold prices slipped four dollars to $1,150 U.S. an ounce.
