Skip to main content

The Globe and Mail

At the open: Indexes slide, Best Buy surges 12%

A trader works on the floor at the New York Stock Exchange in New York, Friday, Dec. 28, 2012. Stocks were heading lower Friday, for a fifth day, on concern that Washington lawmakers will fail to reach a budget deal before a year-end deadline.

Seth Wenig/AP

North American stock markets opened modestly lower, as concerns grew that China may have less room to stimulate its economy after a surprise jump in inflation last month.

In early trading, the S&P/TSX composite index was down 43 points, or 0.3 per cent, at 12,556; the S&P 500 was down 3 points, or 0.2 per cent, at 1,468; and the Dow Jones industrial average was down 27 points, or 0.2 per cent, at 13,443. New York oil futures were down 71 cents at $93.11 (U.S.) per barrel and gold was down $9.40 at $1,668 an ounce.

Investors ditched stocks in China overnight as the country's inflation data for December came in higher than expected. The consumer price index rose 2.5 per cent year-on-year in December after a 2 per cent rise in November. That pointed to the possibility that the Chinese central bank may have less room to ease monetary policy at a time when the economy is just starting to pick up steam again. The Shanghai composite index lost 1.7 per cent, its biggest decline since September.

Story continues below advertisement

The Japan market got a boost overnight though as the government unveiled a $226.5-billion stimulus package, with plans to rebuild disaster-hit areas and beef up the military. It didn't come as a huge surprise given that recently elected Prime Minister Shinzo Abe had pledged big spending plans on the campaign trail. But it fed into a resurgence of market speculation of late that underdog Japan could turn out to be a major market winner in 2013 after years of underperformance.

European stocks are mixed today and without much fresh momentum in either diction. In news there overnight, Spanish annualized industrial production in November plummeted a worse-than-expected 7.2 per cent, while Moody's downgraded Cyprus - which is in bailout talks with the European Union - to a level that is only two notches above default.

In North American economic news this morning, Statistics Canada said the trade deficit in November was $1.96-billion, as exports dropped 0.9 per cent and imports rose 2.7 per cent. The deficit was much larger than the $700-million that was forecast by economists.

The U.S. Commerce Department, meanwhile, said its trade deficit jumped 15.8 per cent in November to $48.7-billion, well above the consensus estimate of $41.2 billion. That was the biggest since April, but wasn't really perceived as all that negative for the U.S. economy, given that much of that deficit increase was due to strong demand for imported goods during the holidays and for foreign automobiles.

Here's a look at stocks moving on early news today:

Best Buy Co. said its nine-week holiday domestic revenue fell 1.2 per cent as same-store sales fell 1.4 per cent. But the company's U.S. sales performance was flat, which marks an improvement from recent quarters and bolsters founder Richard Schulze's bid to take over the retailer. Shares are up 12 per cent.

Wells Fargo & Co. reported net income of 91 cents a share in the fourth quarter, up from 73 cents a year ago, and beating consensus expectations by 2 cents. But shares are down nearly 2 per cent in early trading as the bank reported a slowdown in mortgage lending.

Story continues below advertisement

Research In Motion Ltd. shares are down 1 per cent after BlackBerry users across the Middle East, Europe and Africa were experiencing service disruptions today in a fresh service outage that appeared to be related to Vodafone Group PLC's network and not RIM's servers. BMO Nesbitt Burns also downgraded RIM today to "underperform" and cut its price target to $9 (U.S.).

The FAA has ordered a comprehensive review of the new Boeing 787 airliner after a fire and fuel leak earlier this week. Shares in Boeing are down 2 per cent.

American Express Co. said late Thursday that it will slash roughly 5,400 jobs as it pre-released fourth-quarter earnings of $1.09 per share, ahead of analysts' consensus forecast of $1.06 per share. Shares are up 1.4 per cent.

Chevron Corp. said late Thursday its fourth-quarter profit would be "notably higher" than the previous quarter as oil and gas output bounced back and it booked a $1.4-billion (U.S.) gain on an asset transaction. Shares are up 1 per cent.

Report an error Editorial code of conduct Licensing Options
As of December 20, 2017, we have temporarily removed commenting from our articles. We hope to have this resolved by the end of January 2018. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to If you want to write a letter to the editor, please forward to