The Toronto stock market was lower Thursday amid major announcements from the oilpatch, earnings disappointments and uncertainty about the Federal Reserve’s next move.
The S&P/TSX composite index was down 30.02 points to 13,425.31.
Bombardier Inc. (TSX:BBD.B) was a major drag, down 42 cents or 7.95 per cent to $4.86, as the transport giant missed on earnings and revenue. It posted adjusted net income of $165 million or nine cents per share, which was one cent below estimates. Revenue of $4.1 billion also missed analyst estimates.
“Their order backlog is up a little bit but at the same time, order backlogs don’t produce anything until the equipment is completed and sold and delivered,” said Fred Ketchen, manager of equity trading at ScotiaMcLeod.
The Canadian dollar rose as growth for August came in higher than economists had forecast. The loonie was up 0.39 of a cent to 95.77 cents US after Statistics Canada reported that gross domestic product grew by 0.3 per cent in August against the 0.2 per cent rise that was expected.
Suncor Energy Inc. announced Wednesday after the close that the Fort Hills oilsands project will go ahead with its cost estimated at $13.5 billion. The cost will be shared between Canada’s largest energy company and partners Total E&P Canada Ltd. and Teck Resources Ltd. (TSX:TCK.B).
Suncor also said it recorded net earnings of $1.69 billion, or $1.13 per common share, for the third quarter, compared with $1.54 billion, or $1.01 per common share a year ago. Suncor stock inched up five cents to $38.04 while Teck fell 65 cents to $28.66.
U.S. indexes were lower after Wednesday’s announcement from the Fed left traders no wiser about when the central bank might start tapering its US$85 billion monthly bond purchasing scheme.
The Dow Jones industrials declined 38.25 points to 15,580.51, the Nasdaq was down 1.17 points to 3,929.445 while the S&P 500 index shed 2.38 points to 1,760.93.
The Fed said it would maintain the program for now but hinted that tapering could occur earlier than many investors thought. There had been hopes that the Fed wouldn’t move until at least March, well after Janet Yellen has taken over the reins at the central bank.
The gold sector was the biggest sector decliner, down 3.65 per cent while December bullion fell $25 to US$1,324.30 an ounce. Goldcorp (TSX:G) fell 83 cents to $26.80.
Barrick Gold Corp. (TSX:ABX) is cutting its capital spending budget by a further US$1 billion next year as a result of suspending construction at its troubled Pascua-Lama project which straddles the Argentina-Chile border. At the same time, the miner handed in adjusted earnings of 58 cents per share, down from last year but seven cents better than estimates. Its shares were 51 cents lower to $20.39.
Techs were also a drag as business software company Open Text Corp. (TSX:OTC) fell $3.99 to $75.26 even as the company more than doubled its quarterly profits to $30.6 million, or 52 cents per share. Its shares faded 15 cents to $20.75 on a warning of slower growth.
The base metals sector was down 0.75 per cent as December copper lost two cents to US$3.31 a pound. HudBay Minerals (TSX:HBM) dropped 19 cents to C$8.49.
Financials led advancers, up 0.55 per cent and contributing to a jump of almost seven per cent during October with markets feeling a lot more comfortable that the Canadian housing sector isn’t coming in for a hard landing.
“I’m not too sure there are any worries about the housing market,” said Fred Ketchen, manager of equity trading at ScotiaMcLeod, adding there are other reasons bank stocks have become so popular with most of the big banks hitting fresh, 52-week highs this week.
“I think when you look at the dividend increases, earnings increases and the Canadian banking industry has a very, very strong reputation and people feel comfortable with (financials).”
National Bank (TSX:NA) was ahead 82 cents to $90.58 after earlier hitting a 52-week high of $90.69.
The energy sector was up a slight 0.06 per cent with December crude down 39 cents to US$96.38 following a tumble of almost $1.50 Wednesday in the wake of data showing a much bigger than expected rise in U.S. inventories last week.
Imperial Oil Ltd. (TSX:IMO) missed expectations for earnings and revenue. Imperial had $647 million of net income, or 76 cents per share, down from $1.04 billion or $1.22 a year earlier and below the estimate of 98 cents per share and its shares dropped 35 cents to $45.60.
In the U.S., Facebook shares were up 23 cents or 0.48 per cent to US$49.24, down sharply from the 18 per cent surge racked up in after hours trading Wednesday as worries about a decrease in daily use among younger teenagers trumped earnings and revenue that beat estimates.
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