North American stocks retreated at the start of trading on Wednesday, crushing hopes that the momentum from Tuesday’s strong rally would persist.
The Dow Jones industrial average fell 47 points or 0.4 per cent, to 12,056. The broader S&P 500 fell 5 points or 0.4 per cent, to 1,236. In Canada, the S&P/TSX composite index fell 4 points, to 11,712.
The European Central Bank attempted to ease concerns about tight credit markets in Europe by forwarding nearly €490-billion in three-year loans to more than 500 banks. However, while the loans are expected to help the financial constraints at banks, they also supported concerns that European financial firms expect tough conditions in 2012.
Oracle Corp.’s earnings, released on Tuesday evening, also weighed on stocks. The shares slumped 13.3 per cent after the technology giant’s quarterly earnings missed expectations. The decline dragged on other technology stocks: IBM Corp. fell 3.4 per cent.
However, Research In Motion Ltd. stood out, rising 8.6 per cent on reports that the BlackBerry maker has been discussed as a takeover target by the likes of Nokia Corp., Microsoft Corp. and Amazon.com Inc.
Meanwhile, U.S. economically defensive stocks also held up, with gains from Kraft Foods Inc., and Coca-Cola Co.