The Toronto stock market was lower Wednesday amid retail sector misses while traders looked to the release of the latest minutes of the most recent Federal Reserve meeting for hints as to the pace of further interest rate increases.
The S&P/TSX composite index declined 47.3 points to 15,429.87 after four straight days of gains.
The Canadian dollar added 0.01 of a cent to 91.39 cents (U.S.) as wholesale sales rose 0.6 per cent to $53-billion during June.
U.S. indexes were tepid after two days of advances as the Dow Jones industrials gave back 11.88 points to 16,907.71, the Nasdaq was down 7.14 points to 4,520.38 and the S&P 500 index slipped 2.02 points at 1,979.58.
Sears Canada Inc. reported a quarterly net loss of $21.3-million, or 21 cents (Canadian) per share, compared to a profit of $152.8-million, or $1.50, a year ago. Revenues were $845.8-million compared to $960.1-million year-over-year while same-store sales dropped 6.8 per cent, which the company attributed partly to an unseasonably cool spring. Its shares slipped nine cents to $15.98.
U.S. retailer Target, which is in the midst of a costly expansion into Canada, posted adjusted earnings of 78 cents a share, a penny less than expected. Revenue came in at $17.41-billion (U.S.), higher than the US$17.38 that analysts expected. But its shares fell 42 cents to $58.83 as Target also cut its 2014 forecast to $3.10 to $3.30, versus the previous forecast of $3.49.
Quarterly net income at home improvement retailer Lowe’s increased 10 per cent to $1.04-billion, or $1.04 per share, bolstered by improving weather. The performance beat analysts’ expectations, but the company lowered its full-year revenue outlook slightly, citing its year-to-date sales and prior assumptions for the second half. Its shares fell $1.62 to $49.90.
Meanwhile, the central bank’s minutes will be released mid-afternoon and traders will be looking to see how many individual Fed members feel rates have been kept too low for too long. Many analysts expect the Fed to move from rates that have hovered near zero since the financial crisis around the middle of next year.
On Friday, Fed chairwoman Janet Yellen delivers a speech at the central bank’s annual economic symposium in Jackson Hole, Wyo. She is expected to again signal to the market that the central bank is in no rush to hike rates and when it does, the pace will be gradual.
She is also expected to explain why she believes there is still a lot of slack in the job market. The amount of slack in the labour market is a critical question for the central bank as it decides when to hike rates.
The metals and mining sector led advancers, up one per cent as commodities and mining group Glencore PLC said it will buy back up to $1-billion of its own shares as profit for the first half of the year rose eight per cent. September copper was two cents higher to $3.11 a pound.
The energy sector lost 0.22 per cent with September crude up $1.17 to $95.65 a barrel.
The gold sector faded 0.2 per cent while December bullion dipped 10 cents to $1,296.60 an ounce.