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The US..Congressional Budget Office concluded last May that real GDP growth would be cut by slightly more than half to 0.5 per cent for all of 2013 if the fiscal cliff is not avoided. (JONATHAN ERNST/REUTERS)
The US..Congressional Budget Office concluded last May that real GDP growth would be cut by slightly more than half to 0.5 per cent for all of 2013 if the fiscal cliff is not avoided. (JONATHAN ERNST/REUTERS)

At midday: Markets flat amid lacklustre U.S. economic outlook Add to ...

The Toronto stock market chalked up a small loss Wednesday following another record-high close as traders continued to digest earnings reports from the Canadian banking sector, in this case a solid report from National Bank.

The S&P/TSX composite index gave back 14.69 points to 15,604.52.

The Canadian dollar was up 0.48 of a cent to 91.79 cents (U.S.).

U.S. indexes erased early losses amid a glum economic outlook.

The U.S. Congressional Budget Office says the American economy will grow by just 1.5 per cent this year, hurt by a poor first-quarter performance.

But the CBO also says the U.S. economy should grow by 3.4 per cent over 2015 and 2016, and predicts that the unemployment rate in that country will remain below six per cent into the future.

The Dow Jones industrials was up 13.97 points to 17,120.67, the Nasdaq edged up 1.31 points to 4,571.94 and the S&P 500 index added 0.55 of a point to 2,000.57.

Quebec-based National Bank posted net earnings of $441-million (Canadian), up 10 per cent from a year ago. Adjusted earnings came in at $1.20 a share, nine cents ahead of estimates.

Total revenues for the country’s sixth largest lender were $1.42-billion, up from $1.29-billion in the same period last year.

The bank’s return on equity for the quarter was 19.4 per cent compared with 20.1 per cent year-over-year, and its shares gained $1.41 to a 52-week high of $50.81.

National Bank’s earnings followed reports from Royal Bank, which on Friday posted a record quarterly profit that beat expectations and a dividend increase. Bank of Montreal and Scotiabank reported mixed results Tuesday with expectations elevated for a sector that is up 12 per cent year to date.

“Most of the bank shares rallied into the earnings,” observed Ian Nakamoto, director of research at 3MACS. Most of the big banks are at or very close to 52-week highs or record levels.

“The one thing it shows to me, looking at the Royal and Scotiabank, their core business, the personal and commercial (lending) in Canada, is slowing down. That`s sort of the bread and butter (of the banks). Is the consumer going to start borrowing more? It`s hard to see that.”

CIBC and TD Bank report on Thursday.

In other corporate news, uranium miner Cameco said Wednesday it’s preparing to stop work at its McArthur River mine and Key Lake mill operations in northern Saskatchewan due to a labour dispute. It said the company and the roughly 535 unionized workers represented by the United Steelworkers are set to begin a strike-lockout at 12:01 a.m. on Aug. 30.

Cameco said a labour disruption is not expected to affect its 2014 uranium delivery commitments. Its shares fell 61 cents to $21.30.

On the TSX, the gold sector led decliners, down 0.75 per cent while December bullion declined $1.30 to $1,283.90 (U.S.) an ounce.

The base metals sector was down 0.35 per cent even as December copper was down two cents to $3.20 a pound.

The energy sector gained 0.1 per cent while October crude in New York was up 15 cents to $94.01 a barrel.

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