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Thursday, April 9, 2009 06:38 PM

The close: Markets shrug

David Berman


Bullish investors who believe that the stock market saw its lowest point in October could find plenty to smile about on Monday. U.S. manufacturing activity fell to its lowest level since 1982 and U.S. auto makers reported their worst sales month since the Second World War – and yet major North American stock market indexes barely budged.

The Dow Jones industrial average closed at 9319.83, down 5.18 points or less than 0.1 per cent. The broader S&P 500 closed at 966.31, down 2.44 points or 0.3 per cent.

Given the dismal reports, the slight declines could imply that a deep recession is already be factored into stock prices. Indeed, General Motors Corp. shares fell jut 2.4 per cent after the auto maker reported that its sales plunged 45 per cent in October, year over year. After adjusting for population growth, it represented the worst month in the postwar era. Similarly, Ford Motor Co. shares fell 2.7 per cent after it reported a 30-per-cent drop in sales.

In other moves, Home Depot Inc. fell 5.8 per cent, Walt Disney Co. fell 3.4 per cent and General Electric Co. fell 1.1 per cent. On the upside, Citigroup Inc. rose 2.5 per cent, Microsoft Corp. rose 1.3 per cent and Coca-Cola Co. rose 3.2 per cent.

In Canada, the S&P/TSX composite index closed at 9721.09, down 41.67 points or 0.4 per cent. There, commodity producers were the big weight dragging the index into negative territory, after the price of crude oil tumbled to $63.91 (U.S.) a barrel, down 3.90. EnCana Corp. fell 4.5 per cent, Canadian Natural Resources Ltd. fell 5.4 per cent and Suncor Energy Inc. fell 6.2 per cent. As well, Barrick Gold Corp. fell 4.5 per cent.

However, insurance companies were strong, with Manulife Financial Corp. up 8.3 per cent, and Sun Life Financial Inc. rose 4.1 per cent. Research In Motion Ltd. was another big mover, rising 3.8 per cent, and Bombardier Inc. rose 6.9 per cent.

 

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Markets Blog Contributors

David Berman

David Berman

David Berman has been writing about business and investing since 1995. He began his career at Canadian Business magazine, where he wrote full-length features on a range of topics, from goose slaughterers to broadcasters. Later, he moved to MoneySense magazine, where his emphasis turned to investing. More recently, he worked at the Financial Post as an investing writer and daily columnist. He has a bachelor of arts degree from the University of Toronto and studied journalism at Ryerson University.

 

David Parkinson

David Parkinson has been covering business and financial markets since 1990, and has been with The Globe and Mail since 2000. A Calgary native, he received a Southam Fellowship from the University of Toronto in 1999-2000, studying international political economics.

 

Steve Ladurantaye

Steve Ladurantaye wrote about technology companies in Ottawa before reporting for the Peterborough Examiner and Kingston Whig-Standard, where he won a National Newspaper Award for explanatory journalism. After joining the Globe and Mail in 2007, his work has regularly appeared in Report On Business and Globe Investor Magazine.