The screens at the TMX Broadcast Centre in Toronto show the closing numbers of the TSX on Tuesday, July 3, 2012.Matthew Sherwood/The Globe and Mail
The Toronto stock market was little changed Tuesday following a string of gains while China's leadership indicated it would take measures to support the economy and commodity prices slipped.
The S&P/TSX composite index edged up 3.06 points to 12,761.44 after running ahead for the past four sessions as traders bought up beaten down mining and energy stocks.
Canadian National Railways (TSX:CNR) was in focus after the railroad handed in earnings that beat expectations following the close Monday. CN earned $717-million or $1.69 per diluted share for the quarter ended June 30, up from $631-million or $1.44 per diluted share a year ago. Ex-items, CN earned $1.66 per share, up from $1.50 per share a year ago and four cents ahead of estimates. Revenue totalled $2.67-billion, up from $2.54-billion and slightly below estimates of $2.7-billion and its shares dipped 41 cents to $104.65.
The Canadian dollar was ahead 0.32 of a cent to 96.99 cents US after retail sales for May came in much better than expected. Statistics Canada reports that sales ran up 1.9 per cent, much higher than the 0.4 per cent gain that economists had expected.
The agency said the largest sales increase in dollar terms was a 4.3 per cent gain at motor vehicle and parts dealers.
Chinese media said Premier Li Keqiang had said that growth wouldn't go below seven per cent. He also said that China's economic growth needs to be kept above that minimum, according to Beijing News and reaffirmed 7.5 per cent as this year's growth target.
The report cleared uncertainty about how much China's government would let the economy slow as it tries to shift the basis of growth toward domestic consumption and away from reliance on exports and industrial investment.
U.S. indexes were higher as traders took in a solid earnings report from chemical giant DuPont and looked ahead to earnings from Apple Inc. after the close.
The Dow Jones industrials gained 48.57 points to 15,594.12, the Nasdaq composite index rose 4.41 points to 3,604.8 and the S&P 500 index climbed 2.18 points to 1,697.71.
DuPont's quarterly net income totalled just over $1-billion, or $1.11 per share, compared to $1.16-billion, or $1.23 per share, for the same period last year. Revenue fell one per cent to $9.8-billion. Wall Street analysts surveyed by FactSet were expecting income of $1.27 per share on revenue of $10.04-billion and its shares rose 5.6 per cent in New York.
Meanwhile, analysts expect Apple to report another drop in earnings along with flat sales. The company's iPhone 5 is facing stronger competition from newer smartphones. Apple shares were off 0.4 per cent in New York.
Also after the close, online video streaming company Netflix said it earned $29.5-million, or 49 cents per share, in the latest quarter, up from $6.2-million, or 11 cents per share, a year earlier. Analysts surveyed by FactSet had forecast earnings of 40 cents per share. Netflix's revenue climbed 20 per cent from last year to $1.07-billion, mirroring analyst projections. But it failed to meet expectations for new subscribers and its stock declined 0.5 per cent.
The gold sector gave back some of Monday's runup of over six per cent, down about 1.3 per cent while August bullion lost $5.30 to US$1,330.70. Bullion ran ahead $43 Monday in its biggest one-day gain since June, 2012 and Barrick Gold Corp. (TSX:ABX) gave back 25 cents to C$18.
The base metals sector was up 1.1 per cent with September copper unchanged at US$3.18 a pound after gaining five cents. Teck Resources (TSX:TCK.B) climbed 46 cents to C$24.43.
The energy sector gained 0.27 per cent while the September crude contract on the New York Mercantile Exchange was down 84 cents to US$106.10. Prices fell almost $1 Monday following the release of soft existing home sales data and fell further Tuesday morning ahead of the latest inventory data. Wednesday's report on U.S. crude and fuel stockpiles from the Energy Information Administration will be watched for confirmation that the recent trend of falling inventories, which suggests stronger demand, is continuing.
Sharp drops in U.S. crude supplies for the past three weeks have helped propel oil to its highest in about 16 months. Canadian Natural Resources (TSX:CNQ) rose 15 cents to $34.55.
Earlier in Asia, Japan's Nikkei 225 rose 0.8 per cent while Seoul's Kospi rose 1.3 per cent after South Korea's government said it will unveil a new set of measures to boost the stagnant real estate market including lower taxes on purchases of properties.
Australia's S&P/ASX 200 rose 0.3 per cent.
European bourses were positive as London's FTSE 100 index gained 0.13 per cent, and Frankfurt's DAX climbed gained 0.2 per cent and the Paris CAC 40 ticked 0.18 per cent higher.