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The Globe and Mail

At the open: China worries rattle markets

The ZTE building in Nanshan Hi-Tech Industrial Estate, in the southern Chinese city of Shenzhen, in this June 9, 2011 file photo.


The Toronto stock market was little changed Wednesday amid a report of a deteriorating business climate in China.

Traders also awaited a second day of testimony before Congress by U.S. Federal Reserve chairman Ben Bernanke and the release of the central bank's so-called Beige Book, its regional study of economic conditions.

The S&P/TSX composite index edged up 11.02 points to 11,582.21. The TSX Venture Exchange added 3.56 points to 1,180.31.

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The Canadian dollar was unchanged at 98.76 cents U.S. ahead of the release of the Bank of Canada's Monetary Policy Report and a news conference by bank governor Mark Carney. The bank on Tuesday opted to leave interest rates unchanged at one per cent while again indicating that rates will rise in the future.

Some of China's biggest corporations are warning of profit declines nearing 80 per cent.

On Wednesday, Air China Ltd., one of three huge, government-owned airlines, warned that profit for the first half of the year will fall by at least half from a year earlier. State-owned ZTE Corp., one of the world's biggest producers of telecommunications equipment, is projecting a decline of up to 80 per cent.

Chinese leaders are trying to pull China out of its deepest slowdown since the 2008 crisis.

Forecasters say the slowdown might have bottomed out after growth fell to a three-year low of 7.6 per cent in the second quarter.

U.S. markets were mainly lower as the Dow Jones industrial average slipped 18.39 to 12,787.15.

The Nasdaq composite index was ahead 9.45 points to 2,919.49 and the S&P 500 index fell 0.11 of a point to 1,363.56.

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On the TSX, the consumer staples sector was the leading percentage gainer, up 0.65 per cent as convenience store chain Alimentation Couche Tard gained $1.54 to $49.46.

The TSX energy sector was up 0.36 per cent as the August crude contract on the New York Mercantile Exchange gained 21 cents to $89.43 (U.S.) a barrel. Canadian Natural Resources climbed 59 cents to $27.90.

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