December 18, 2007 / 10:19 PM / in 10 years

UPDATE 5-Toronto stocks drop as credit worries rise

 (Adds details, quotes)
 By Leah Schnurr
 TORONTO, Dec 18 (Reuters) - The Toronto Stock Exchange’s main index ended lower on Tuesday after a choppy session as sliding financial shares, hit by renewed worries about the credit crisis, prompted a broad-based decline.
  The index’s financial sector fell 0.7 percent, with Canadian Imperial Bank of Commerce (CM.TO) dropping C$1.85, or 2.5 percent, to C$72.29, and Royal Bank of Canada (RY.TO) sliding 39 Canadian cents, or 0.8 percent, to C$50.71.
 The fall came after Goldman Sachs Group Inc (GS.N), the biggest U.S. securities firm, said it was cautious about its near-term outlook even though it reported earnings that topped forecasts. This stirred fears of further fallout linked to the U.S. subprime mortgage crisis and resulting credit squeeze.
 Adding to concerns over the financial sector, an investor committee trying to create a fix for the asset-backed commercial paper market missed last Friday’s deadline to announce details of its repair plan.
 Toronto-Dominion Bank (TD.TO) said on Monday that while it was willing to consider steps to help repair the third-party ABCP market, it didn’t believe that it should shoulder a burden it didn’t create.
 “There continues to be lot of concern about the state of financials and their exposure to this whole subprime mess in the U.S.,” said Elvis Picardo, investment strategist at Northern Securities Inc., in Vancouver, British Columbia.
 “Going forward, we will continue to see a volatile environment, where concerns resurface about the slowing of the global economy, and that will obviously mean that commodities groups will continue to be quite volatile in the near term,” Picardo said.
 The benchmark S&P/TSX composite index .GSPTSE closed down 29.04 points, or 0.22 percent, at 13,358.07 with eight of the TSX’s 10 main groups in negative territory.
 It was the fourth day in a row the index has declined and extends Monday’s sharp 287-point drop.
 The index is down 2.4 percent so far for December, a month that has been historically positive. Analysts said that this could set the tone for the new year.
 “We’re getting perilously late for a Santa rally to happen this year,” said Peter Chandler, senior vice-president at Canaccord Capital in Waterloo, Ontario.
 The industrials sector fell 0.6 percent, while Transcontinental Inc (TCLa.TO) (TCLb.TO) slid after reporting lower fourth-quarter profit. The commercial printer ended down 65 Canadian cents, or 3.7 percent, at C$16.80.
 On the upside, the materials group managed a 0.3 percent gain, despite worries that a economic slowdown could dampen demand for resources.
 Kinross Gold (ABX.TO) rose 36 Canadian cents, or 2.2 percent, to C$16.54, and Barrick Gold (ABX.TO) gained 54 Canadian cents, or 1.4 percent, to C$38.21, helped by an advance in gold prices.
 In other news, BioMS Medical Corp MS.TO jumped 37.8 percent, or C$1.02, to C$3.72 after it signed a global licensing and development agreement with Eli Lilly (LLY.N) for its multiple sclerosis compound.
 Market volume was 426 million shares worth C$7 billion. Decliners outpaced advancers 975 to 682. The blue chip S&P/TSX 60 index .TSE60 closed down 1.61 points, or 0.21 percent, at 780.86.
 In New York, markets rallied as investors snapped up technology shares and bargain-hunting helped offset a decline in Goldman shares.
 The Dow Jones industrial average .DJI ended up 65.27 points, or 0.5 percent, at 13,232.47, and the Nasdaq Composite Index .IXIC gained 21.57 points, or 0.84 percent, to 2,596.03.  ($1=$1.01 Canadian)  (Editing by Peter Galloway)   

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below