The Toronto stock market was slightly lower after the open Wednesday amid economic uncertainties tied to the political turmoil in Egypt, coupled with a re-emergence of sovereign-debt worries in Portugal.
The S&P/TSX composite index dipped 18.40 points to 12,159.98 shortly after markets opened.
The Canadian dollar rose 0.08 of a cent to 94.88 cents US.
The same developments were adding pressure to Wall Street early Wednesday. The Dow Jones industrials fell 9.39 points to 14,923.02, the Nasdaq was off 2.26 points at 3,431.14 and the S&P 500 index was 4.41 points lower at 1,609.67.
Egypt’s unfolding political crisis pushed the price of oil to its highest level in more than a year, rising above US$100 a barrel for the first time since May 2012. The August crude contract on the New York Mercantile Exchange was ahead $2.04 at US$101.64 a barrel.
August bullion also gained traction, up $6 to US$1,249.40 an ounce on the Nymex. Copper prices rose 2.6 cents to US$3.168 a pound.
Portugal’s financial markets went into a nosedive Wednesday as the government teetered on the brink of collapse, alarming investors and reigniting concerns about the eurozone’s strategy for dealing with its prolonged financial crisis.
Prime Minister Pedro Passos Coelho has defied calls to resign but was running out of options to keep his centre-right coalition government together following the resignations of two key ministers in a spat over austerity.
On the TSX, telecom stocks pulled back once again, off 1.3 per cent, after Mobilicity pushed back a vote on the company’s proposed recapitalization plan by a week.
The struggling wireless service provider, which has reportedly held talks with U.S. telecom giant Verizon, did not give a reason for the delay Wednesday, other than saying it wanted to consider “potential alternatives.”
Shares of Canadian wireless companies have been weaker since rumours emerged of a potential new competitor in the domestic industry. Rogers Communications (TSX:RCI.B) was off 80 cents to $41.57 and Telus (TSX:T) fell 54 cents to $31.12.
In earnings, Sandvine Corp, (TSX:SVC) swung to a US$900,000 profit in the second quarter as the Waterloo, Ont.,-based broadband technology provider posted significantly higher revenues in reversing last year’s Q2 loss. Revenues rose 27 per cent to US$23.5-million from US$18.6-million in the same 2012 period. Shares of Sandvine were off six per cent, or 12 cents, to $1.99.
In Europe, stock markets everywhere were down sharply. The FTSE 100 index of leading British shares was down 1.6 per cent at 6,206, while Germany’s DAX fell 1.4 per cent to 7,800. The CAC-40 in France was 1.8 per cent lower at 3,677.
Earlier, Asian markets also closed lower with Japan’s Nikkei 225 down 0.3 per cent at 14,055.56 as the yen rallied against the U.S. dollar. A rising yen is a sign investors are wary but it makes Japanese goods more expensive in export markets. The dollar was 1.1 per cent lower at 99.72 yen.
Elsewhere in Asia, Hong Kong’s Hang Seng shed 2.5 per cent to 20,147.31, while Seoul’s Kospi fell 1.6 per cent to 1824.66. In China, the Shanghai Composite lost 0.6 per cent to 1,994.27 following disappointing manufacturing data.
The sell-off came as embattled Egyptian President Mohammed Morsi vowed not to resign despite the demands of millions of protesters and a threat by the military to suspend the constitution, disband parliament and install a new leadership.
Egypt is not an oil producer but its control of the Suez canal – one of the world’s busiest shipping lanes, which links the Mediterranean with the Red Sea – gives it a crucial role in maintaining global energy supplies.