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Kash Pashootan, Senior Vice President and Portfolio Manager at First Avenue Advisory, Raymond James breaks down CIBC's latest quarter. (BNN Video)

Kash Pashootan, Senior Vice President and Portfolio Manager at First Avenue Advisory, Raymond James breaks down CIBC's latest quarter.

(BNN Video)

At midday: Financials push TSX lower Add to ...

The Toronto stock market was lower Thursday amid a poorly received earnings report from CIBC, while data showed the U.S. economy performing worse than expected earlier this year.

The S&P/TSX composite index lost 45.39 points to 14,565.57.

CIBC said that poor results in its Caribbean operations were responsible for net income dropping to $306-million from $862-million a year ago. CIBC’s adjusted net income came in at $2.17 per share, beating analysts’ expectations of $2.07 per share. CIBC also raised its quarterly dividend by two cents to $1 per common share. However, its shares dropped $1.80 to $97.24.

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Financials led TSX decliners with all of the major banks, save Scotiabank, giving back some of the gains racked up over the last week as most of the banks delivered strong results.

“You’ve seen banks outperform as a group, about three per cent over the last week or so, not surprising we’re having a bit of a profit-taking on them,” said Stephen Lingard, Managing Director of Franklin Templeton Solutions.

“There is a slowing momentum in mortgage products and they’re having to be pretty competitive with each other. But they have had other segments that have offset this, notably wealth (management) and business loans so all in all a good quarter.”

The Canadian dollar was up 0.18 of a cent to 92.13 cents (U.S.).

U.S. indexes were higher as the first revision to first-quarter gross domestic product showed that GDP actually shrank at an annualized rate of one per cent during the period, largely because of severe winter weather. That was much higher than the 0.5 per cent drop that economists had expected, but they anticipate the weakness to be short-lived.

The Dow Jones industrials rose 8.3 points to 16,641.48, the Nasdaq climbed 11.08 points to 4,236.15 and the S&P 500 index rose 3.09 points to 1,912.87.

In other corporate developments, Bank of Nova Scotia is selling more than two-thirds of its interest in CI Financial Inc. in a deal worth at least $2.27-billion, making it one of the largest public offerings in Canada. Scotiabank will sell 72 million common shares of CI at $31.50 per share, reducing its current 37 per cent interest to about 11.4 per cent. CI shares climbed 16 cents to $33.81 and Scotiabank added 24 cents to $69.06.

The debut of shares in Encana Corp. subsidiary PrairieSky was a huge success Thursday. The energy giant earlier in the morning announced the completion of the initial public offering of 52 million common shares of PrairieSky at an offering price of $28 and by mid-morning, the shares were trading at $36.20 on the TSX. Encana is spinning off some of its Alberta land holdings through PrairieSky.

Former prime minister Brian Mulroney is expected to be elected as board chairman of media giant Quebecor Inc. next month. Pierre Karl Péladeau stepped down as board vice-chairman of Quebecor in March and chairman of subsidiary Quebor Media when he announced plans to run for the Parti Quebecois in the April election. The move could signal an attempt by Quebecor to put some distance between itself and Péladeau. Quebecor shares slipped 37 cents to $26.38.

Elsewhere on the TSX, the energy sector was down 0.3 per cent while July crude gained 52 cents to $103.24 (U.S.) a barrel.

The gold sector was the leading advancer, up 1.15 per cent as June bullion lost $1.70 to $1,258 an ounce.

The base metals sector was up 0.16 per cent, while July copper slipped three cents to $3.14 a pound.

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