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Barclay's specialist trader Michael Pistillo gives a opening price to traders on the floor of the New York Stock Exchange, July 10, 2012. (BRENDAN MCDERMID/REUTERS)
Barclay's specialist trader Michael Pistillo gives a opening price to traders on the floor of the New York Stock Exchange, July 10, 2012. (BRENDAN MCDERMID/REUTERS)

At the open: Resource stocks lead sell off Add to ...

The Toronto stock market was sharply lower Thursday amid growing worries about a slowing global economy.

Resource stocks led declines as commodity prices gave up ground after the U.S. Federal Reserve signalled conditions don’t warrant another round of economic stimulus right now. And traders were braced for more data from China showing the world’s second-largest economy slowing faster than thought.

The S&P/TSX composite index tumbled 132.7 points to 11,411.95 while the TSX Venture Exchange was down 11.45 points to 1,181.34.

Sliding prices for oil and copper helped push the Canadian dollar down 0.39 of a cent to 97.66 cents U. S.

U.S. markets were also under selling pressure as the Dow Jones industrials lost 101.49 points to 12,503.04.

The Nasdaq composite index was down 36.9 points to 2,851.08 and the S&P 500 index dropped 13.1 points to 1,328.35.

There was little positive reaction to U.S. data that showed the number of people signing up for unemployment benefits plunged last week to the lowest level in four years. Claims dropped 26,000 to a seasonally adjusted 350,000.

Special factors affected the report. Automakers have traditionally closed their plants for the first two weeks in July to prepare them to build new car models. But this year they are limiting the shutdowns to boost production. That resulted in fewer temporary layoffs than is normally the case in early July.

Demand worries pushed the August crude contract on the New York Mercantile Exchange down $1.10 to US$84.71 a barrel. The energy group lost 1.3 per cent and Suncor Energy (TSX:SU) fell 35 cents to $28.90.

Crude has plummeted from $106 in May amid expectations that a global slowdown led by Europe, the U.S. and China will undermine oil demand.

The base metals sector lost two per cent as copper prices slid four cents to US$3.40 a pound. Teck Resources dropped 49 cents to $30.05.

The gold sector was also down about two per cent as bullion gave back $18 to US$1,557.70 an ounce. Barrick Gold Corp. faded 69 cents to $34.97.

All TSX sectors were lower with financials down 0.8 per cent and Royal Bank shed 52 cents to $52.28.

On the earnings front, Corus Entertainment Inc. says its third-quarter net income was $42.2-million, or 52 cents per share compared with $40.3 million or 49 cents a year earlier, excluding discontinued operations. Revenue fell to $204 million in the three months ended May 31, down from $211.8-million in the third quarter of fiscal 2011. Corus shares fell $1.10 to $22.30.

Cogeco Cable Inc. dipped 33 cents to $45.50 after it said its third-quarter profit from continuing operations edged up to $53.2-million or $1.09 per share. That was five cents per share below a consensus estimate compiled by Thomson Reuters. The company also lowered one of its 2012 performance targets but said it expects to achieve its financial objectives with competitive marketing and cost controls.

Astral Media Inc.’s third-quarter profit was up seven per cent to $56.2 million or $1 per share from a year ago but missed analyst estimates by two cents. The company reported $265.5-million in revenue, missing forecasts of $276.4-million. Astral is being acquired by BC Inc. in a friendly deal awaiting approvals. Astral shares dipped a penny to $49.06.

The Maple Group Acquisition Corp. cleared its last major regulatory hurdles Wednesday in its takeover of the TMX Group Inc. as the B.C. and Alberta securities regulators signed off on the deal. TMX shareholders will have the final say on whether the deal is approved and have until July 31 to tender their shares. TMX Group shares added 15 cents to $49.


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