News Column

Sharp dip for stocks

June 24, 2014



Gold, energy take biggest hit







The Toronto stock market turned sharply lower Tuesday afternoon despite strong U.S. housing and consumer confidence figures.

The S&P/TSX composite index tumbled 143.26 points, or 1%, to close Tuesday at 14,962.37

The Canadian dollar dropped 0.10 cents at 93.08 cents U.S.

Most TSX sectors were negative with the gold sector falling after rising about 6% over the last six sessions. Gold prices and stocks have steadily advanced this month because of geopolitical worries centred on Iraq and tensions between Ukraine and Russia.

Barrick Gold fell 37 cents to $19.12

The energy sector was lower as oil prices edged lower with the August crude contract on the New York Mercantile Exchange down. Suncor collapsed $1.59, or 3.4%, to $44.66, while Imperial Oil gave back $1.30, or 2.3%, to $55.58

Oil prices had risen steadily over the past couple of weeks amid a rising insurgency in Iraq. But prices fell on Monday as fears receded that the insurgency would greatly affect the country's oil production and exports.

Still the energy sector is the strongest TSX performer, up about 7% over the last month alone

The base metals sector was down while copper was unchanged at $3.15 U.S. a pound following a three-cent rise Monday sparked by strong Chinese data.

Teck Resources lost 49 cents, or 2%, to $23.95.

On the corporate front, Bell Media, the radio and television division of BCE Inc, is laying off as many as 120 employees or about five per cent of its Toronto workforce due to "financial pressure" in its advertising and subscription TV services. BCE shares dipped 20 cents to $48.33.

AGF Management Ltd. shares were down 50 cents, or 3.9%, to $12.28 as the mutual fund operator and wealth management company reported it had $14.5 million or 17 cents per share of net income in its fiscal second quarter, contrasting with a year-earlier loss of $10.4 million or 12 cents per share.

Revenue from continuing operations was down from a year earlier, dropping to $119.1 million from $126.9 million.

ON BAYSTREET

The TSX Venture Exchange dropped 7.40 points to 1,016.58

All but two of the 14 Toronto subgroups were lower on the day, with gold stumbling 2.5%, energy off 2.4%, and the metals and mining group down 1.8%

The two lone gainers were health-care, inching up but 0.1%, and real-estate, squeezing up 0.02%.

ON WALLSTREET

The stock market's early gains evaporated Tuesday, after several days at record-setting peaks.

The Dow Jones Industrials plummeted 119.13 points to close at 16,818.13

The S&P 500 dropped 12.63 points to 1,949.98, and the NASDAQ composite slid 18.32 points to 4,350.36

Shares in Buffalo Wild Wings jumped 6% Monday after an analyst at Wunderlich Securities increased his price target for shares after seeing all the demand for the flagship wings for soccer games. But the stock was down Tuesday as the enthusiasm waned a bit.

Carnival Corp reported quarterly results that topped expectations, but the company's forecasts for the rest of the year weren't as rosy. The stock dropped as much as 2%.

The cruise line operator blamed fuel prices and currency exchange rates, which it said will reduce earnings full-year by 6 cents per share.

Walgreens said earnings rose nearly 16% in the first quarter, but the results missed analysts' expectations. Shares fell more than 1%.

Vertex Pharmaceuticals soared 40% after the company said a study of its cystic fibrosis drug produced positive results.

Groupon shares were up 8% on an upbeat analyst report.

Home prices throughout the United States continued to rise in April. The S&P/Case-Shiller index measuring the value of residential real estate in 20 U.S. cities increased 1.1%.

What's more, a measure of consumer sentiment rose to the highest level since Jan. 2008. The Conference Board's index of consumer confidence increased to 85.2 in May from 82.2 in April, suggesting that Americans remain optimistic about the economy.

Prices for 10-year U.S. Treasuries gained ground, lowering yields to 2.59% from Monday's 2.62%. Treasury prices and yields move in opposite directions.

Oil prices subsided 20 cents to $105.97 U.S. a barrel.

Gold prices gained $1.40 at $1,319.80 U.S. an ounce.


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Source: Baystreet Stock Market Update (Canada)


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