North American stocks opened in the red, as investors grew cautious about expanding equity holdings at a time when budget cuts are set to take effect in the U.S. and China is taking measures to cool its housing market.
In early trading, the S&P/TSX composite index was down 56 points, or 0.4 per cent, at 12,716; the S&P 500 was down 4 points, or 0.2 per cent, at 1,514; and the Dow Jones industrial average was down 54 points, or 0.3 per cent, at 14,036.
Commodities were fairly steady, with gold up $4.80 at $1,577.10 (U.S.) an ounce and oil down 12 cents at $90.56 per barrel.
The selling activity kicked off overnight in China, where Beijing announced new property-buying restrictions that included higher down payments and mortgage rates on second homes in certain cities. It also imposed a 20-per-cent capital gains tax on sales of existing sales. The measures are likely to slow the country's housing sector, a key driver of its economy.
There was some evidence overnight that Chinese growth could be tapering off already, as its non-manufacturing managers' index dropped to 54.5 in February from 56.2 in January. That represented the slowest pace in growth in China's services sector since September. The Shanghai stock market closed down 3.6 per cent.
In the U.S. this weekend, there was little to signal that the Republicans and Democrats were any closer on reaching a deal to scale back the $85-billion in spending cuts that started kicking in on Friday. The U.S. Congressional Budget Office has estimated the cuts will slow gross domestic product growth by 0.6 of a percentage point this year, and President Barack Obama's aides and congressional leaders have suggested the spending curtailments could continue for weeks, if not longer. Negotiations could become wrapped into upcoming budget talks that will be aimed at keeping federal agencies running beyond March 27, as well as debt ceiling adjustments that need to be made later this year.
Markets are also keeping close tabs on the political situation in Italy following the election last month that resulted in a hung government. Leaders there are struggling to navigate a path to cooperation but another election appears likely to be on the horizon. European stocks this morning are mostly lower, with Italy's FTSE MIB down 0.4 per cent and London's FTSE 100 down 0.5 per cent.
Here's a look at some stocks moving on news so far today:
Research In Motion Ltd. shares are down nearly 1 per cent after Yahoo Inc. said it was shutting its BlackBerry app for smartphones. Also, Canaccord Genuity this morning said it previously reduced its February-quarter sales estimates too much for the BlackBerry 10 Z10 smartphone. It increased its sales forecast to 800,000 from 300,000, but said its latest surveys still show "modest" demand for BlackBerry smartphones. Canaccord maintained a "sell" rating and $9 (U.S.) price target.
Aurizon Mines Ltd. has received a friendly $796-million takeover offer from Hecla Mining Co. for $4.75 per share, 40 cents per share above Aurizon’s closing stock price on Friday. The offer is also 10 cents per share above a hostile takeover bid for Aurizon from Alamos Gold Inc. Aurizon's shares opened up 5 per cent; Hecla shares plunged 10 per cent at the open.
Hess Corp. said it will sell its downstream businesses, including retail, energy marketing and energy trading. Shares opened up 4 per cent.
Las Vegas Sands Corp. said it probably violated the U.S. foreign Corrupt Practices Act, which prohibits improper business payments outside the U.S. Its shares were down 1.7.