Canadian stocks rallied to trim some of the losses Wednesday, but still closed lower for a sixth straight day on global cues. The decline hinged on mining issues with commodities continuing to reel under selling pressure as investors avoided riskier assets amid political uncertainty in Greece. While the Greek drama continued unabated, the Spanish banking system came under pressure even as government bond yields soared.
The Greek turmoil continued with no end in sight to the political uncertainty in the formation of a new government. Observers see little chance of any resolution to the stalemate in formation of a government, with indications that Greece may likely to go in for yet another election next month. Speculations over Greece defaulting on its sovereign debt and moving out of the eurozone also seem to be gaining ground.
Financial markets in Europe roiled under pressure as speculations were rife on a Spanish government move to nationalize troubled lender Bankia SA. Spanish government bond yields jumped over 6 percent on its 10-year notes.
Toronto's main index, the S&P/TSX, closed Wednesday at 11,675.01, down 29.73 points or 0.25 percent. The S&P/TSX Composite Index touched an intraday high of 11,755.80 and a low of 11,555.08.
The TSX Venture Index closed at 1,345.69, up 7.32 points or 0.55 percent. The index opened at 1,323.46 compared to its previous close of 1,338.37.
Major components of the S&P/TSX Index in negative territory were the Diversified Metals & Mining Index down 0.48 percent, the Financial Index down 0.83 percent, and the Energy Index down 0.22 percent. Among gainers were the Materials Index up 0.77 percent and the Global Gold Index up 1.85 percent.
An EIA report showed U.S. crude oil inventories to have jumped 3.70 million barrels, while gasoline stocks dipped by 2.60 million barrels in the week ended May 4. Analysts expected crude oil inventories to gain 2 million barrels last week.
Crude oil prices for June delivery dropped $0.20 or 0.2 percent to close at $96.81 a barrel on the NYMEX Wednesday.
Among energy stocks, Suncor Energy (SU.TO) dropped 2.08 percent, while Canadian Natural Resources Limited (CNQ.TO) gained 0.33 percent. Encana Corp (ECA.TO) gained 4.14 percent, while Penn West Petroleum Ltd. (PWT.TO) edged down 0.74 percent.
Enbridge Inc. (ENB.TO) edged down 0.05 percent after reporting a lower first quarter profit, but were in line with analysts expectations.
Gold prices dropped $10.30 or 0.6 percent to close at $1,594.20 an ounce Wednesday on the NYMEX.
Among gold stocks, Eldorado Gold Corporation (ELD.TO) gained 1.54 percent, while Kinross Gold Corp. (K.TO) shed 1.03 percent. Barrick Gold Corp. (ABX.TO) gained 2.56 percent and B2Gold Corp. (BTO.TO) jumped 7.19 percent.
Mercator Minerals Ltd. (ML.TO) down 2.30 percent and Uranium One Inc. (UUU.TO) down 3.36 percent. Potash Corporation of Saskatchewan Inc. (POT.TO) was down 0.72 percent.
The Financial Index decline was led by Royal Bank of Canada (RY.TO) down 1.33 percent and Bank of Nova Scotia (BNS.TO) shedding 0.87 percent.
Fertilizer maker Agrium Inc. (AGU.TO) shed 1.59 percent after posting a lower first quarter net earnings. Adjusted earnings of C$1.32 per share, however, was better than analysts' expectations of C$0.99 per share.
Restaurant chain Tim Hortons Inc. (THI.TO) surrendered nearly 2.21 percent even after posting higher first-quarter net income of C$88.8 million or C$0.56 per share.
Smartphone maker Research In Motion (RIM.TO) introduced its BlackBerry Curve 9320 smartphone. The stock eased 0.58 percent.
Heavyweight transportation systems maker Bombardier Inc. (BBD.B.TO) shed 5.38 percent.
Media and broadcasting company Quebecor Inc. (QBR_A.TO, QBR_B.TO) eased 0.93 percent despite reporting improved first quarter net income at C$72.9 million or C$1.14 per share compared to C$34.3 million or C$0.52 per share in the first quarter of 2011.
Communications and consumer electronics Wi-LAN Inc. (WIN.TO) slipped in to the red in first quarter, reporting a net loss of $14.41 million or $0.12 per share.Adjusted earnings were $0.13 per share, better than analysts expectations of $0.11 per share.The stock shed over 4 percent.
Publishing company Torstar Corp. (TS_B.TO) surrendered 1.49 percent after reporting that its first-quarter net income of C$29.3 million or C$0.37 per share up from C$15.5 million or C$0.19 per share last year.
Finning International Inc. (FTT.TO) gained nearly 2 percent after reporting earnings that beat street estimates.
In economic news from south of the border, the wholesale inventories in the U.S. rose by less than expected in the month of March, according to a report released by the Commerce Department, with a notable increase in inventories of durable goods partly offset by a drop in inventories of non-durable goods. The report showed that wholesale inventories increased by 0.3 percent in March following a 0.9 percent increase in February. Economists had expected inventories to increase by about 0.6 percent.
From the eurozone, Germany's exports rose by seasonally adjusted 0.9 percent in March from the prior month, data from Destatis showed. Economists were forecasting a 0.5 percent drop for March after expanding 1.5 percent in February. At the same time, imports climbed 1.2 percent month-on-month, faster than the 1 percent rise forecast by economists. However, the rate of growth slowed from the 3.6 percent increase seen in February.
Meanwhile, data from the Federal Statistical Office showed Germany's manufacturing turnover increased at a slower pace in March. Manufacturing turnover increased a seasonally adjusted 0.2 percent month-on-month in March, slower than the 1.2 percent growth seen in February.
by RTT Staff Writer
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