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Nasdaq (ANDREW KELLY/REUTERS)

Nasdaq

(ANDREW KELLY/REUTERS)

At midday: Markets fall as tech selloff resumes Add to ...

The Toronto stock market dipped into the red late morning Tuesday as China’s growth worries punished mining stocks.

The S&P/TSX composite index lost 9.51 points to 14,274.92, while a stronger U.S. currency helped depress commodity prices.

The Canadian dollar was down 0.24 of a cent to 91.06 cents (U.S.) as the greenback found strength amid another round of worries about Chinese economic growth and a much better than expected read on March retail sales on Monday.

U.S. indexes lost early momentum as a selloff of formerly high-flying biotech and technology shares resumed with the Dow Jones industrials down 38.7 points to 16,134.54; the Nasdaq dropped 40.02 points to 3,982.67 and the S&P 500 index gave back 4.65 points to 1,825.96.

Markets had earlier found buoyancy from well-received earnings reports.

Coca-Cola earnings beat expectations as the beverage giant said adjusted per-share earnings fell to 44 cents while net operating revenues fell to $10.58-billion. Analysts polled by FactSet had expected earnings of 44 cents on revenue of $10.55-billion and Coca-Cola shares rose 3.3 per cent.

Also, drug company Johnson&Johnson reported earnings per share of $1.54, seven cents better than analyst forecasts while revenue of $18.115-billion beat forecasts of $17.996-billion. It shares ran up 1.45 per cent.

Intel and Yahoo report earnings after the close.

Worries about China weighed as data showed a tightening of credit growth. Money supply growth climbed just 12.1 per cent year-over-year in March, the slowest pace in 17 years.

And that slowing in credit growth raised fresh worries about economic growth in the world’s second-biggest economy. There are worries that gross domestic product growth may fall below seven per cent in the current year, a full 0.5 of a percentage point below the government’s target for growth. Official growth figures for China will be released Wednesday.

“Clearly the growth is slowing, officially guiding at 7.5 per cent, but the leadership has said the growth will not come at the expense of reform,” said John Stephenson, portfolio manager at First Asset Funds.

“So, to the extent that reform does occur, and it’s badly needed, that would be a good thing. So, China is making the right moves, but so much is predicated on them getting things exactly right.”

The rising U.S. dollar helped depress commodity prices. A stronger greenback makes it more expensive for holders of other currencies to buy oil and metals which are dollar-denominated.

May crude on the New York Mercantile Exchange fell 22 cents to $103.83 (U.S.) a barrel, but the energy sector was up 0.35 per cent.

Encana Corp. has filed a preliminary prospectus for spinning off a portion of its assets into a separate publicly traded business, to be called PrairieSky Royalty Ltd. The Calgary-based natural gas producer expects to own a majority interest in PrairieSky, but precise details of the stake weren’t disclosed in the prospectus. Encana shares were 18 cents higher to $24.96 (Canadian) after earlier hitting a new 52-week high of $25.36

The TSX also found support from the telecom and financial sectors.

The base metals sector was the major decliner, down 2.5 per cent while May copper fell six cents to $2.99 (U.S.) a pound.

The gold sector declined 2.45 per cent while June bullion fell $25.70 to $1,301.8 an ounce.

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