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Gold at Montreal bullion dealer Bart Kitner's company, Kitco.

IAN BARRETT/Globe & Mail

The Toronto stock market fell in early trading Tuesday, weighed down by declining prices in bullion and materials.

The S&P/TSX composite index dropped 29.91 points to 13,960.38. The Canadian dollar dipped 0.13 of a cent to 91.19 cents U.S., a day before the Bank of Canada makes its next announcement on interest rates.

On Wall Street, it was a much rosier picture as U.S. indexes gained following strong earnings reports by telco Verizon and energy services company Halliburton. The markets had been closed on Monday for the Martin Luther King holiday.

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The Dow Jones industrials rose 14.71 points to 16,473.27, the Nasdaq was ahead 24.12 points to 4,221.70 and the S&P 500 climbed 8.65 points to 1,847.35.

Gold prices left an impact on the TSX, with February bullion dropping $14.30 to US$1,243.70 an ounce on the New York Mercantile Exchange. The gold sector was the biggest decliner on the stock market, as it fell 2.19 per cent. Shares in Barrick Gold took back 82 cents or 3.8 per cent to $20.74.

The materials sector also weakened at the open, falling by 1.98 per cent as shares in Agrium declined 1.45 per cent or $1.51 to $102.86 a share. The Calgary based fertilizer producer issued new guidance for its fourth-quarter earnings on Monday, saying that it expects them to be at the "bottom" of previous estimates.

It had said earlier it expected earnings to be between 80 cents (U.S.) to $1.25 per diluted shares.

Agrium says its updated guidance is primarily due to lower than expected selling prices across all wholesale nutrients in the quarter and lower than expected urea ammonium nitrate and domestic potash sales volumes, partly due to problems with rail shipments.

In other commodities, March copper took back two cents to $3.33 a pound, while the February crude oil contract moved up 51 cents to $94.88 a barrel.

Markets had been uneasy on Monday with data suggesting that China's fourth-quarter growth declined slightly from the previous quarter but confidence rebounded after the Chinese central bank promised to inject extra liquidity into its financial system. The move comes ahead of the Lunar New Year holiday, when credit often is tight.

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"This will reduce the credit crunch fears and assure funding continues to flow into the Chinese economy over this period," said strategist Evan Lucas at IG Markets in a report.

Figures for the latest quarter showed the Chinese economy grew at an annual pace of 7.7 per cent compared with a year earlier, down from the previous quarter's 7.8 per cent. Growth for the full year was 7.7 per cent, tying 2012 for the weakest annual performance since 1999.

Overnight, China's benchmark Shanghai Composite Index rose 0.9 per cent to 2,008.31 and Tokyo's Nikkei 225 jumped 1 per cent to 15,795.96. Hong Kong's Hang Seng gained 0.5 per cent to 23,033.12 while Seoul, Taiwan and Sydney also rose.

In the U.S., with little economic news coming until Thursday, investors will stay focused on a heavy slate of fourth-quarter earnings.

Energy services firm Halliburton reported that its net income grew by 19 per cent, boosted by a strong performance from its international operations. The oilfield-services company earned $793-million, or 93 cents per share, for the three months ended Dec. 31. That compares with $669-million, or 72 cents per share, a year earlier.

Income from continuing operations was 90 cents per share. When removing restructuring charges, it was 93 cents per share. Analysts had expected earnings of 89 cents per share on revenue of $7.55-billion.

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Meanwhile, telco Verizon said its addition of more wireless devices to its network helped it post a fourth-quarter net income of US$5.07-billion. The results beat Wall Street expectations and its shares edged higher.

The largest U.S. cellphone carrier's profit amounted to US$1.76 per share. The company lost $4.23-billion, or $1.48 per share, in the year-ago period. Excluding one-time items, the company says it posted an adjusted profit of 66 cents per share.

Revenue rose 3 per cent to $31.07-billion from US$30.05-billion. Analysts polled by FactSet expected a profit of 62 cents per share on $31.04-billion in revenue.

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