Wednesday, November 26th0.1°C
22246
23943

Toronto stock market falls amid lower commodities and ECB's surprise rate cut

TORONTO - The Toronto stock market ended lower on Thursday, weighed down by energy and gold stocks despite a better than expected report on merchandise trade for July and plans by the European Central Bank to stimulate the eurozone's weak economic recovery.

The S&P/TSX composite index shed 80.84 points to 15,576.79. The Canadian dollar was ahead 0.12 of a cent at 91.96 cents US.

Wall Street indexes also stepped back from earlier gains to finish lower, with the Dow Jones industrials dipping 8.70 points to 17,069.58, the Nasdaq losing 10.28 points to 4,562.29 and the S&P 500 index falling 3.07 points to 1,997.65.

The ECB trimmed its benchmark interest rate to a record low of 0.05 per cent from the previous all-time low of 0.15 per cent. It also cut its growth forecast for 2014 to 0.9 per cent from 1.0 per cent and lowered its inflation forecast for the year to 0.6 per cent from 0.7 per cent.

ECB president Mario Draghi also said the bank will start buying asset-backed securities and covered bonds in October.

The efforts are aimed at making credit cheaper as concerns continue to grow that the economy of the 18-country eurozone might go into reverse.

"The eurozone was moving in the right direction over the last few years, but . . . it's (now) going backwards a little bit, so something had to happen," said Sadiq Adatia, chief investment officer at Sun Life Global Investments.

"This is another sign that the ECB will do something, whatever it takes, to move the markets higher and get growth back into the economy."

Although the timing may have been a surprise, the measures fell short of expectations by some that an ECB stimulus program would involved the purchase of government bonds, similar to what the U.S. Federal Reserve has done.

In economic news, Statistics Canada reported a higher than anticipated trade surplus. The agency said Canada's merchandise exports grew by 1.4 per cent in July, while imports edged down 0.3 per cent. That raised the country's trade surplus with the world to $2.6 billion from $1.8 billion in June. Economists had expected a surplus of about $1.2 billion, according to Thomson Reuters.

There was some encouraging news from in the United States.

U.S. services firms expanded in August at the fastest pace on record and businesses added jobs at a healthy pace in August, according to a private survey, the fifth straight month of solid gains.

Meanwhile, traders will look to U.S. job figures for August as well as the latest Canadian jobs data, both being released Friday.

On the corporate front, Manulife Financial Corp. (TSX:MFC) announced after markets closed on Wednesday that it was buying the Canadian operations of Standard Life for $4 billion in cash. Manulife said the acquisition will boost its presence in Quebec, which it has underserved in the past. Its shares closed down 1.39 per cent, or 31 cents, to $22.05 on the Toronto Stock Exchange.

In commodities, the December crude contract was down $1.09 to US$94.45 a barrel, while December gold bullion fell $3.80 to US$1,266.50 an ounce. December copper jumped two cents to $3.15.

Adatia said investors are pulling back from gold and oil because the global economy, particularly the U.S. economy, is looking strong.

Follow @LindaNguyenTO on Twitter.

The Canadian Press


Read more Business News




Recent Trending




Today's Market
S&P TSX15073.65+58.24
S&P CDNX780.64-6.86
DJIA17814.94-2.96
Nasdaq4758.252+3.36
S&P 5002067.03-2.38
CDN Dollar0.8877-0.0008
Gold1196.20-0.90
Oil73.94-0.15
Lumber328.80-0.70
Natural Gas4.295+0.144

 
Okanagan Companies
Pacific Safety0.16-0.005
Knighthawk0.01-0.005
QHR Technologies Inc1.32+0.04
Cantex0.040.00
Anavex Life Sciences0.175-0.005
Metalex Ventures0.030.00
Russel Metals32.14+0.65
Copper Mountain Mining2.15-0.02
Colorado Resources0.130.00
ReliaBrand Inc0.0134-0.0001
Sunrise Resources Ltd0.045-0.005
Mission Ready Services0.325-0.04

 
23744


23015

FEATURED Property
10475211377 Nishi Court
$159,999
more details
image2image2image2
Click here to feature your property
Please wait... loading


The last great Canadian tax shelter

A guide to how flow-through fund limited partnerships can mightily aid your tax planning!The end of the year will raise concerns among many professionals, self-employed persons, business owners and ev...


What I learned in China: Part 2

As per my previous article on my visit to China, we have much to learn about and from their people. It is potentially the largest market on earth with 1.3 billion people in one country but much will d...


Retirement: Health Issues

Our health is really our greatest asset and maintaining our health is of tremendous importance. You want to do what you can to ensure that health issues will not jeopardize the enjoyment of your retir...

_



24119

24220


Member of BC Press Council


24018