Canadian stocks were lingering deep in the red Wednesday morning as rising bond yields for Italy and Spain worsened fears about the euro zone's debt crisis. Meanwhile, commodities suffered losses after media reports suggested that China, the second largest commodity consuming nation, may not dole out substantial stimulus.
The S&P/TSX Composite Index dived 183.33 points or 1.58 percent to 11,425.97.
The Diversified Materials Index was the major losers, shedding nearly 3 percent. Teck Resources (TCK_B.TO), Inmet Mining (IMN.TO) and First Quantum Minerals (FM.TO) were down around 3 percent each.
The price of crud oil dived to a fresh 7-month low Wednesday morning as concerns over the banking sector in Spain escalated fears over the euro zone debt situation. Further, a strong dollar also weighed on oil prices. Crude for July lost $3.13 to $87.63 a barrel.
In the oil patch, MEG Energy (MEG.TO) dived over 5 percent. Baytex Energy Corp. (BTE.TO), Cenovus Energy (CVE.TO) and Imperial Oil (IMO.TO) were down around 3 percent each
The price of gold was ticking lower Wednesday morning amid lingering worries over the euro zone debt situation and firm U.S. dollar. Gold for August delivery, the most actively traded contract, lost $8.00 to $1,543.00 an ounce.
Agnico-Eagle Mines (AEM.TO) lost close to 4 percent.
Research In Motion (RIM.TO) lost 8 percent. The smartphone maker warned of a first quarter operating loss and revealed that it has hired J.P. Morgan Securities LLC and RBC Capital Markets to assist the company in reviewing business and financial performance.
Women clothing stores operator Reitmans Canada Ltd. (RET.TO) lost over 4 percent after reporting first-quarter net loss of C$53,000 or breakeven per share compared to a net income of C$624,000 or C$0.01 per share in the prior year period.
In economic news, Statistics Canada said the Industrial Product Price Index (IPPI) was steady in April, after three consecutive advances. Of the major commodity groups, eight were up, nine were down and four were unchanged. Compared with the same month a year earlier, the IPPI rose 0.4 percent in April. Meanwhile, the Raw Materials Price Index fell 2.0 percent, largely because of mineral fuels.
Elsewhere, euro zone economic confidence declined more than expected to 90.6 in May from revised 92.9 in April, survey results from European Commission showed. Economists were forecasting the index to drop to 91.9. The industrial confidence deteriorated to -11.3 in May from -9 in April. Economists had forecast a fall to -10.2.
by RTT Staff Writer
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