News Column

Stocks start to strengthen

February 5, 2014

Jobs data fails to impress Stock indices in Toronto were enjoying marginal gains midday Wednesday, even as an unexpectedly weak report on U.S. private-sector job creation raised doubts about the strength of government data coming out on Friday The S&P/TSX composite index pulled into the green 36.94 points to greet noon at 13,541.42 The Canadian dollar dumped 0.16 cents to 90.07 cents U.S. On the earnings front, Intact Financial Corp. says a major December ice storm in Ontario and Quebec drove down quarterly net operating income to $143 million or $1.05 a share, down 26% from a year ago, missing estimates of $1.49 a share. Intact also announced its dividend will rise 9% to 48 cents a share and its shares declined 64 cents to $66.87 . Shares in TMX Group Ltd. rose 78 cents to $50.64 as the operator of the country's largest stock market had adjusted quarterly earnings of 96 cents per share, up one cent from a year ago and 11 cents above analyst estimates. Strength on the TSX was mainly concentrated in the gold sector, which rose, as Barrick Gold retreated 39 cents to $20.82 , and Goldcorp gave up one cent to $27.81 . The energy sector was ahead as Imperial Oil was up six cents to $45.47 , and Suncor took on 21 cents to $35.22 The base metals group was also positive while March copper gained one cent to $3.20 U.S. a pound. Teck Resources fell 16 cents to $26.20 The euro-zone's private sector logged its busiest month in two and a half years in January as strong manufacturing growth outshone a more modest expansion in services activity, surveys showed. On matters economic, figures released by Statistics Canada revealed that building permits issued by Canadian municipalities declined 4.1% to $6.5 billion in December, following a 6.6% decrease in November. The agency added that lower construction intentions for commercial buildings and multi-family dwellings in Ontario and British Columbia were responsible for much of the decrease at the national level in December. ON BAYSTREET The TSX Venture Exchange staggered 6.29 points to 941.42 The 14 Toronto subgroups were evenly split between gainers and losers, as financials triumphed 1%, real-estate gained 0.7%, and energy stocks were better by 0.5%. The seven laggards were weighed mostly by telecoms, sliding 1%, while health-care and consumer staples each faded 0.5%. ON WALLSTREET Stocks slid on a cold and wet Wednesday morning on Wall Street . The Dow Jones Industrial Average dipped 3.66 points at noon ET to 15,441.58. The Dow has fallen by nearly 7% since the start of 2014. The S&P 500 index moved lower by 2.97 points to 1,752.23. The NASDAQ subtracted 16.08 points to 4,015.44 CVS Caremark said it will stop selling tobacco products, starting Oct. 1 . Shares were down slightly in early trading. Shares of 3D Systems plunged after the company warned that last year's earnings will be below its previous forecast. Rival 3D printing companies Stratasys, ExOne and voxeljet all fell sharply as well. Merck reported earnings and sales in line with forecasts, while GlaxoSmithKline raised its dividend as it posted earnings-per-share that came in slightly below expectations. Both stocks were up. Time Warner announced a new $5-billion U.S. share buyback program as it reported slightly better-than-expected earnings. But the stock fell about 2%. Twitter will report quarterly results after the close -- the first since last year's IPO. Shares of mobile chip company ARM Holdings continued to slide after posting a sharp drop Tuesday. ARM's stock has fallen by 20% since the start of 2014 Investors have been rattled by concerns about emerging markets, where central banks have been struggling to shore up shaky currencies. Meanwhile, the U.S. Federal Reserve has been scaling back its bond-buying program. On Wednesday, payroll processor ADP said that 175,000 jobs were added in January. That was in line with expectations but was the slowest level of growth since August. The government will release its latest figures about job growth and the unemployment report on Friday. Prices for 10-year U.S. Treasuries faded, driving up yields to 2.66% from Tuesday's 2.62%. Treasury prices and yields move in opposite directions. Oil prices gained 10 cents to $97.29 U.S. a barrel. Gold prices hiked $7.20 to $1,258.40 U.S. an ounce.

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Source: Baystreet Stock Market Update (Canada)

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