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Traders work on the floor of the New York Stock Exchange, November 8, 2013. (BRENDAN MCDERMID/REUTERS)
Traders work on the floor of the New York Stock Exchange, November 8, 2013. (BRENDAN MCDERMID/REUTERS)

At midday: TSX slides on financials, Bombardier delay Add to ...

The Toronto stock market was slightly lower Thursday, weighed down by financials and a warning from transport giant Bombardier that its flagship new airliner will be going into service later than expected.

The S&P/TSX composite index was down 14.36 points to 13,758.22.

Bombardier (TSX:BBD.B) shares were 29 cents or 6.42 per cent lower to $4.33 after the company announced the delay concerning its new CSeries aircraft.

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It said that the CS100 won’t be going into service until the second half of 2015, while the larger CS300 will go into service about six months later. The initial CSeries planes were previously expected to be ready for service late this year or early in 2015.

“It’s hard to know what the cause of the delay is,” said John Stephenson, portfolio manager at First Asset Funds.

“There’s a cash-burn issue associated with this delay and whether or not they have to end up funding it through an equity issue is some of the worry.”

The Canadian dollar rose 0.14 of a cent to 91.51 cents (U.S.).

U.S. indexes were lower amid earnings reports from the banking sector and data showing a continuing decline in jobless insurance claims and tame inflation.

The Dow Jones industrials fell 90.9 points to 16,391.04, the Nasdaq was down 4.74 points to 4,210.14 while the S&P 500 index shed 5.87 points to 1,842.51.

Goldman Sachs turned in fourth quarter earnings per share of $4.60 (U.S.), higher than the $4.22 that analysts had forecast. Revenue came in at $8.78-billion versus the $7.713-billion that was expected but its stock lost early momentum and turned down $3.13 to $175.62.

Citigroup fell $2.15 to $52.84 as the bank posted earnings per share ex-items of 82 cents versus the 95 cents that analysts had forecast. Revenue was $17.94-billion, weaker than the $18.18 analysts expected.

On the economic front, the U.S. consumer price index rose a slight 0.3 per cent during December, translating into an annualized rate of 1.5 per cent.

And the Labor Department said that claims for jobless benefits declined last week by 2,000 to 326,000, which was in line with expectations.

This was the first glimpse of the job market since the release last Friday of a disappointing employment that showed job creation coming in at 74,000, far less than the 200,000 that had been expected.

That data raised a fresh round of questions about how the Federal Reserve will proceed on further cutting back on its massive monthly bond purchases which have kept long term rates low and encouraged a strong rally on equity markets.

It said last month as it cut $10-million from its monthly bond purchases, which fall to $75-billion, and that further tapering depended on the strength of the economy, particularly job creation.

The Bombardier announcement helped push the industrial segment down 1.2 per cent. Railroad stocks also declined and Canadian National Railways fell $1.44 to $58.29 (Canadian) while Canadian Pacific Railway lost $2.58 to $161.67.

Financials also dragged as Manulife Financial gave back 22 cents to $21.74.

The energy group was slightly in the red as February crude on the New York Mercantile Exchange declined 19 cents to $93.98 (U.S.) a barrel.

The metals and mining sector led advancers, up almost two per cent while March copper declined one cent to $3.35 a pound. Teck Resources gained 78 cents to $28.10 while Thompson Creek Metals advanced for a third day after an upgrade by Bank of America/Merrill Lynch. Its stock rose nine cents to $3.25 after rising 12 per cent Wednesday and 18 per cent Tuesday.

February bullion climbed $3.50 to $1,241.80 (U.S.) an ounce and the gold sector rose 0.1 per cent. Iamgold climbed six cents to $4.24.

In other corporate news, Montreal-based food company Saputo is closer to acquiring a majority state in Australia’s oldest dairy processor. Bega Cheese Ltd. says it will sell its 18.8 per cent stake in Warrnambool Cheese & Butter to Saputo. Prior to Bega’s announcement, Saputo had acquired about one-quarter of Warrnambool’s stock. Saputo continues to face one rival, Australia’s Murray Goulburn, which owns about 17.7 per cent of Warrnambool. Saputo gained 44 cents to $51.38.

And Best Buy shares plunged 27.8 per cent to $27.12 (U.S.) in New York as it said Thursday that a key sales barometer fell during the holiday shopping season. Best Buy Co. said comparable store sales dipped 0.8 per cent for the nine weeks ended Jan. 4. This was better than the 1.7 per cent decline in the prior-year period European bourses were negative as London’s FTSE 100 index was off 0.03 per cent, Frankfurt’s DAX was down 0.21 per cent and the Paris CAC 40 declined 0.37 per cent.

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