TSX slides on oil, mining as macro worries return

Wed Jan 16, 2013 4:48pm EST
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By John Tilak

TORONTO (Reuters) - Canada's main stock index slipped on Wednesday, led by energy and material shares, as gloomy economic commentary from the World Bank and weak industrial data out of Europe renewed investor concerns about global growth.

Investors shifted their focus, if briefly, from corporate earnings to macroeconomic concerns after the World Bank said a slow economic recovery in developed nations was holding back the global economy as it sharply cut its outlook for world growth in 2013.

Meanwhile, demand for new cars in recession-bound Europe fell to a 17-year low in 2012, highlighting the crisis for automakers on the continent.

"The economic risk and the political risk are still out there. (But) we're really relying on company fundamentals," said Michael Newton, associate director and portfolio manager at Macquarie Private Wealth Inc.

Several of Canada's major companies, including Canadian National Railway Co (CNR.TO: Quote), will be reporting quarterly earnings next week.

Investors are looking for strong evidence of earnings and sales strength as the fourth-quarter reports come rolling in, not more blame being placed on macro conditions, Newton said.

"It's going to be a really important quarter. This is your third visit to the doctor," he added.

The index eased from a 10-1/2 month high hit on Tuesday, when the materials sector outperformed the market. The group on Wednesday played a major role in leading the market lower.   Continued...

A Toronto Stock Exchange (TSX) logo is seen in Toronto November 9, 2007. REUTERS/Mark Blinch