Saturday, October 25th8.7°C
23711
23589

TSX closes lower amid weak Wal-Mart outlook, disappointing European growth data

TORONTO - The Toronto stock market closed lower Thursday amid data showing the economic recovery in the European Union proceeding at a slower than expected pace and a disappointing outlook from retail giant and economic bellwether Wal-Mart stores.

The S&P/TSX composite index dropped 84.84 points to 14,588.89.

The Canadian dollar was up 0.05 of a cent at 91.94 cents US.

U.S. indexes finished the session deep in the red as the Dow Jones industrials tumbled 167.16 points to 16,446.81, leaving the index in negative territory for the year to date. The Nasdaq dropped 31.34 points to 4,069.29 and the S&P 500 index fell 17.68 points to 1,870.85.

Wal-Mart's quarterly earnings came in at $3.59 billion, or $1.11 per share, down from $3.78 billion, or $1.14 per share a year ago as bad winter weather kept shoppers away. Its performance missed Wall Street’s view and, on top of that, the world’s biggest retailer gave a second-quarter earnings forecast below analysts’ estimates. Wal-Mart’s stock fell $1.91 or 2.43 per cent to US$76.83.

"Wal-Mart is a market mover," observed Stephen Lingard, managing director, Franklin Templeton Solutions. "The miss and their weak outlook is going to hit a market that is looking for excuses maybe to take profits after a nice rebound."

Meanwhile, Eurostat, the EU’s statistics office, said the eurozone saw output grow by only 0.2 per cent in the first quarter from the previous three-month period. Economists had expected a 0.4 per cent increase.

A large chunk of the blame for the underperformance can be placed on a flat performance in France, Europe’s second-largest economy behind Germany.

The figures are likely to strengthen arguments for the European Central Bank to cut interest rates and take further stimulus measure at its next meeting June 5.

"It certainly seems like there is more support for more unorthodox sort of monetary policy out of Europe," added Lingard. "If anything, they should have been talking about this a year ago."

The gold sector was down about 1.75 per cent as June bullion fell $12.30 to US$1,293.60 an ounce.

July copper was down two cents at US$3.14 a pound and the base metals sector eased 1.06 per cent.

The energy sector fell 0.7 per cent as June crude on the New York Mercantile Exchange fell 87 cents to US$101.50 a barrel.

Bombardier (TSX:BBD.B) also weighed on the TSX after Air Canada decided not to immediately replace its remaining fleet of narrow-body Embraer E190s with the transport giant’s CSeries airliners. The carrier said that the 90-seat aircraft are still relatively young and it prefers to avoid more capital expenditures and debt as it focuses on adding 37 Boeing 787 Dreamliners and retrofitting 18 Boeing 777s with more seats. Bombardier shares fell 30 cents or 7.14 per cent to $3.90 on very heavy volume of 42.6 million shares.

Air Canada (TSX:AC.B) also posted an adjusted net loss of $132 million, or 46 cents per diluted share, compared with a net loss of $143 million, or 52 cents per share, year over year as it was impacted by a lower Canadian dollar. Its shares slipped 31 cents to $7.91.

Elsewhere on the corporate front, Scotiabank (TSX:BNS) wants to sell some or all of its 37 per cent stake in asset manager CI Financial Corp. (TSX:CIX). That position, acquired in 2008, is worth about $3.8 billion and the bank believes it can more profitably deploy the capital elsewhere. CI Financial shares fell $1.15 or 3.18 per cent to C$34.98, while Scotiabank was up 56 cents to $67.53.

The Canadian Press


Read more Business News

23833


Recent Trending




Today's Market
S&P TSX14543.82+56.99
S&P CDNX805.45-3.15
DJIA16805.41127.51
Nasdaq4483.715+30.923
S&P 5001964.58+13.76
CDN Dollar0.8901-0.0003
Gold1231.20+2.10
Oil81.02-0.73
Lumber336.40+6.80
Natural Gas3.631+0.009

 
Okanagan Companies
Pacific Safety0.105-0.005
Knighthawk0.01-0.005
QHR Technologies Inc1.15-0.02
Cantex0.07+0.015
Anavex Life Sciences0.194-0.004
Metalex Ventures0.045+0.005
Russel Metals33.39+0.23
Copper Mountain Mining2.03-0.05
Colorado Resources0.145+0.005
ReliaBrand Inc0.012-0.001
Sunrise Resources Ltd0.05-0.01
Mission Ready Services0.445+0.035

 





FEATURED Property
20883412161 Campbell Place
4 bedrooms 2 baths
$875,000
more details
image2image2image2
Click here to feature your property
Please wait... loading


What I learned in China

Photo: ContributedI will never be an expert on China. It is just too big, too complex and too old with layers of history and meaning that would take several lifetimes to unravel. As I said to my hosts...


We can get on together

I was in LA this week. I witnessed such crazy and unusual circumstances as I strolled along Hollywood Blvd and Sunset Blvd. A far cry from sleepy Peachland in the Okanagan! The strange thing was, I f...


Weakening global growth worries

The Big Picture Growth worries persist Worries about weakening global growth and its potential impact on the US economic recovery roiled markets around the globe this week. Europe continues to be the ...

_








Member of BC Press Council


22632