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Traders at the New York Stock Exchange. (Richard Drew/AP)
Traders at the New York Stock Exchange. (Richard Drew/AP)

At the open: TSX loses ground Add to ...

The Toronto stock market was lower Wednesday as a weak outlook from resource giant Alcoa Inc. added to a pessimistic global economic assessment from the International Monetary Fund.

The S&P/TSX composite index fell 29 points to 12,244.57 while the TSX Venture Exchange dropped 10.5 points to 1,317.31.

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The Canadian dollar was off 0.01 of a cent at 102.18 cents US.

New York indexes were also negative after Alcoa predicted aluminum demand would grow six per cent this year, down from seven per cent in the previous quarter, primarily because of slower growth in China.

The aluminum producer is viewed as a broad economic bellwether as its products are used in a wide variety of industries, from vehicles to appliances.

Alcoa shares were down just over one per cent as the company kicked off the start of the third-quarter reporting season by posting a loss of US$143-million, largely on one-time charges. Adjusted results beat estimates, as did revenue, which came in at $5.83-billion.

The Dow Jones industrials were 33.02 points lower at 13,440.51.

The Nasdaq shed 0.33 of a point to 3,064.69, and the S&P 500 index edged down 1.74 points to 1,439.74.

North American markets racked up sharp losses Tuesday after the International Monetary Fund reduced its growth forecast for the world economy to 3.3 per cent this year from its previous estimate of 3.5 per cent. The IMF forecast for growth in 2013 is 3.6 per cent, down from 3.9 per cent three months ago and 4.1 per cent in April. The IMF also reiterated its concerns over the crisis in the eurozone and warned that the recession in Spain was worse than it thought.

Expectations for third-quarter earnings have been ratcheted lower because of global growth concerns. Analysts expect earnings for Standard & Poor’s 500 companies to be lower than a year ago, the first time that has happened in almost three years.

On the Canadian earnings front, pharmacy chain franchisor Jean Coutu Group (TSX:PJC.A) said Wednesday that its quarterly net profit was $51.2-million or 23 cents per share. That compared with $66.4-million or 20 cents per share in the comparable year-earlier period when it recorded an unusual gain on the sale of U.S. assets. Revenue for its fiscal 2013 second quarter rose to $658.7-million from $635.2-million in the same fiscal 2012 period and the Quebec-based company’s shares were up 16 cents to $14.69.

The base metals sector led decliners, down 0.45 per cent as the IMF also downgraded growth prospects for China while December copper was unchanged at US$3.72 a pound. Teck Resources (TSX:TCK.B) gave back 27 cents to C$30.19.

The energy sector declined 0.3 per cent with oil prices lower after concerns about supplies from the Middle East and the North Sea had pushed crude prices up more than US$3 on Tuesday. On Wednesday, the November crude contract on the New York Mercantile Exchange slipped 31 cents to US$92.08 a barrel. Suncor Energy (TSX:SU) fell 30 cents to C$32.39.

Tech stocks also weighed on the TSX with Research In Motion Ltd. (TSX:RIM) down another 14 cents to $7.48. RIM stock fell 5.5 per cent Tuesday after Jeffries and Co. analyst Peter Misek published a note saying he believes it is “more likely” that RIM won’t roll out its new phones until the end of the calendar first quarter. Investors had been hoping for a January launch.

The gold sector was slightly lower while December gold declined $3.10 to US$1,761.90 an ounce. Barrick Gold Corp. (TSX:ABX) was down 16 cents at C$39.44.

European bourses were lower with London’s FTSE 100 index off 0.3 per cent, Frankfurt’s DAX down 0.15 per cent and the Paris CAC 40 down 0.08 per cent.

Traders also took in news that Britain’s BAE Systems PLC is abandoning a proposed merger with European counterpart EADS NV that would have created a global defence and aerospace giant. The deal had faced political objections from the governments of the U.K., France and Germany.

Elsewhere, Japan’s Nikkei 225 index tumbled two per cent to its lowest close in two months, Hong Kong’s Hang Seng fell 0.1 per cent while South Korea’s Kospi dropped 1.6 per cent.

The Shanghai Composite Index rose 0.2 per cent on hopes that Chinese authorities are readying measures to help reverse the decline in growth in the world’s second-largest economy.

In other corporate news, Bauer Performance Sports Ltd. (TSX:BAU) is buying team uniform maker Inaria International for $7-million. The hockey and lacrosse equipment company said the deal will help expand its business to include uniforms and its shares ticked up a penny to $10.96.

Package delivery company FedEx Corp. said it plans to add US$1.7-billion to its annual profit by fiscal 2016 by cutting the number of employees and aircraft and trimming underused assets. Founder and CEO Fred Smith said most of the cost cuts will come in the company’s Express and Services units, which have been hurt the most by the slow global economy. FedEx shares ran up $2.91 to US$88.49.

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