News Column

Stumble at TSX open

February 3, 2014

TransCanada in focus Markets in Toronto faltered at the open Monday, as strains in emerging markets show little sign of abating and data showed China's economy is losing momentum. The S&P/TSX composite index moved lower by 73.44 points to begin Monday at 13,621.50 The Canadian dollar moved up 0.42 cents to 90.40 cents U.S., after spending much of last week below the 90-cent mark. Replacing the Keystone XL pipeline with oil-laden freight trains from Canada may result in an average of six additional rail-related deaths per year, according to a U.S. State Department report that is adding to pressure for President Barack Obama to approve the line. TransCanada Corp., the company at the centre of the controversy, saw its shares jump 41 cents to $48.83 National Bank Financial raised the price target on Cascades Inc. to $8 from $7.50 based on positive momentum as it relates to pricing and costing. Cascades gained eight cents to $6.94 . National Bank Financial started coverage on DeeThree Exploration with an outperform rating and price target of $11.50 , believes the current valuation is reflective of top-tier growth metrics to date and go-forward targets. DeeThree shares took on seven cents to $9.31 . National Bank Financial raised the price target on TMX Group to $49 from $48 to reflect higher-than-expected secondary financings during the fourth quarter. The company that runs the Toronto Stock Exchange docked 13 cents per share to $50.44 . In matters economic, euro-zone factories enjoyed their strongest month since mid-2011 in January as new orders flooded in, prompting them to take on new staff for the first time in two years, according to surveys. Moreover, Asian manufacturing outside China showed signs of solid expansion in January as order books swelled, but factories in the region's giant struggled for growth, heightening concerns about an economic slowdown. Closer to home, Statistics Canada reported that its industrial product price index rose 0.7% in December, mainly because of higher prices for energy and petroleum products. The raw materials price index rose 1.9% during the same month, led by crude energy products. ON BAYSTREET The TSX Venture Exchange recaptured 1.46 points to start trading at 952.78 All but two of the 14 Toronto subgroups were lower to kick things off Monday, with metals and mining down 2%, global base metals regressing 1.7% and information technology down 1.5%. The two gainers were gold, up 1.4%, and materials, ahead 0.5%. ON WALLSTREET Following the worst January in years, investors were hoping for some good news to begin February. Unfortunately, it was not forthcoming, at least, not yet. The Dow Jones Industrial Average dropped 88.08 points, to begin a new week at 15,610.77. The S&P 500 index skidded 10.84 points to 1,771.75. The NASDAQ plunged 40.83 points to 4,063.05 Investors are unwilling to make big bets after disappointing earnings and volatility in emerging markets sent stocks sharply lower during the first month of the year. The Dow tumbled more than 5% last month -- its worst January since 2009. In corporate news, Herbalife shares were higher after the company said fourth quarter earnings would top forecasts. The company also raised the amount of its planned share repurchase by $500 million U.S. Hedge fund manager Bill Ackman has accused Herbalife of being a pyramid scheme. But the nutritional supplements marketer has refuted those claims. Shares of Jos. A. Bank Clothiers declined after The Wall Street Journal reported that the company is in talks to buy fellow apparel retailer Eddie Bauer . The potential deal would be the latest twist in the battle between Jos. A. Bank and Men's Wearhouse. Both retailers have offered to buy each other. Automakers are reporting January sales Monday. Chrysler reported that sales were up last month but Ford and GM both said that sales fell more than expected in January. Restaurant operator Yum! Brands is set to release quarterly results after the closing bell. Prices for 10-year U.S. Treasuries gained a bit of ground, dropping yields to 2.66% from Friday's 2.67%. Treasury prices and yields move in opposite directions. Oil prices gained 19 cents to $97.68 U.S. a barrel. Gold prices shot up $10.00 to $1,249.80 U.S. an ounce.

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Source: Baystreet Stock Market Update (Canada)

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