FRANK GUNN/The Canadian Press
The Toronto stock market closed lower Friday amid strong earnings from the tech sector and easing commodity prices as China move s to reform its industrial sector.
The S&P/TSX composite index lost 21.24 points to 12,647.9.
Celestica Inc. (TSX:CLS) was a bright spot on the stock market, up 62 cents or 6.34 per cent to $10.40 after the electronics manufacturing company posted a profit of $28-million, or 15 cents per share, up from $23.6-million, or 11 cents per share, a year earlier. Adjusted earnings were 21 cents a share, four cents better than analysts expected.
The Canadian dollar was off 0.09 of a cent to 97.34 cents US.
U.S. indexes were largely listless despite data showing consumer sentiment at a six-year high. The University of Michigan's consumer confidence index came in at 85.1 for July.
The Dow Jones industrials closed up 3.22 points to 15,558.83, the Nasdaq composite index rose 7.98 points to 3,613.16 and the S&P 500 index added 1.4 points to 1,691.65.
There are concerns an overhaul of China's industrial sector could cause a sharp slowdown in the world's second-largest economy.
Beijing has ordered companies to close factories in 19 industries from steel to glass where overproduction has led to price-cutting wars, affirming its determination to push ahead with a painful makeover of the economy. That move followed weak manufacturing data on Wednesday.
The energy sector led decliners, down about one per cent as demand concerns pushed commodities lower. The September crude contract on the New York Mercantile Exchange was down 95 cents to $104.54 a barrel. But energy stocks have found traction over the past month, rising almost six per cent. The price for West Texas Intermediate, the North American benchmark, has moved up about eight per cent this month amid sliding inventory levels in the U.S.
And efforts to improve the flow of crude southward from Cushing, Okla., the major trading hub for oil, has improved the price of Western Canadian Select, a benchmark for the Alberta oilsands.
Canadian Natural Resources fell $1.50 or 4.45 per cent to C$32.20.
September copper fell eight cents to $3.11 a pound but the mining sector pushed ahead almost one per cent as Teck Resources (TSX:TCK.B) advanced for a second day following earnings that beat expectations, up 70 cents to $25.11.
The resource sector has been the worst performer this earnings season, largely because of falling commodity prices amid a weak global economy.
"But the thing there is that the numbers on the face of it aren't good, but they are surprisingly ahead of expectations," said Robert Gorman, chief portfolio strategist at TD Waterhouse.
"Teck is a classic example here in Canada. Bottom line is that their earnings were about half what they were a year or so ago. But the stock had been crushed going into this and has started to firm up a bit."
The gold sector was ahead about 1.4 per cent while August bullion fell $7.30 to US$1,321.50 an ounce.
Elsewhere on the earnings front, TransCanada Corp (TSX:TRP) earned $365-million or 52 cents per share in net income attributable to shareholders in the second quarter, up from $272-million or 39 cents per share a year earlier. On an adjusted basis, the company reported $357-million or 51 cents per share of "comparable earnings," up from $300-million or 43 cents per share in the second quarter of 2012 and in line with analyst estimates. Its shares were two cents higher to $46.43.
Both Toronto and New York indexes have racked up solid gains this month, with the Dow and S&P 500 establishing a string of record highs on positive economic data and earnings.
The Toronto market is back in positive territory for the year as investors bought up mining stocks and insurers led a strong gain in financials as bond yields started to rise in response to speculation about whether the Fed will start to cut back on a key stimulus measure.
Next week's meeting of the U.S. Federal Reserve will be closely watched for any clue as to when the central bank might be thinking of trimming it $85-billion a month of bond purchases, a move that has kept long-term rates near record lows and supported a strong stock market rally.
Next week will also see the release of the latest readings on economic growth for both the U.S. and Canada, the health of the American manufacturing sector and the week ends with the release of the U.S. non-farm payrolls report.