Snapping their five-session gains, Canadian stocks were lingering in the red Tuesday morning as traders were concerned over the growth in the world’s largest economy after US President Barack Obama warned Republicans over the debt ceiling.
Meanwhile, rating agency Fitch ratings warned that failure to raise the debt ceiling within a “timely” manner would see the US’ sovereign ratings put under formal review with “highly uncertain” consequences.
The S&P/TSX Composite Index slipped 1.13 points or 0.01 percent to 12,601.96, after adding just over 100 points or nearly 1 percent in the past five straight sessions.
The price of crude oil was ticking lower Tuesday morning amid concerns over the economic growth in the wake of escalating fight over the U.S. debt limit. Crude for February shed $0.40 to $93.74 a barrel.
In the oil patch, Coastal Energy (CEN.TO) and Peyto Exploration & Development Corp. (PEY.TO) were down around 2 percent each.
Athletic apparel company Lululemon Athletica Inc. (LLL.TO) lost 7 percent after it said it expects fourth-quarter revenue to be at the high end of its original guidance range of $475 million to $480 million based on a comparable-store sales percentage increase in the high single digits on a constant-dollar basis. The company now expects fourth-quarter earnings of $0.74 per share, compared with the prior guidance of 0.71 to $0.73 per share.
Diversified communications & media company Shaw Communications (SJR_B.TO) slipped 0.25 percent after announcing an about $700 million asset-sale deal with Rogers Communications Inc. (RCI_B.TO). Shares of Rogers were down 0.10 percent
healthcare services provider Amica Mature Lifestyles (ACC.TO) shed 1 percent despite reporting that its second-quarter Funds from Operations increased to C$3.3 million or C$0.11 per share from C$2.3 million or C$0.10 per share in the same quarter last year.
Meanwhile, gold stocks were trading firm amid a surge in bullion prices. The price of gold was extending gains Tuesday morning on safe-haven buying after Federal Reserve Chairman Ben Bernanke warning. Gold for February added $12.10 to $1,681.50 an ounce.
Among gold plays, Centerra Gold (CG.TO) gained about 5 percent. Goldcorp. (G.TO), Barrick Gold (ABX.TO) and Alamos Gold Inc. (AGI.TO) gathered around 2 percent each.
Aurizon Mines (ARZ.TO) moved up over 1 percent after it said it is in the process of reviewing and evaluating an unsolicited bid from Alamos Gold on January 14 for all of the issued and outstanding shares of Aurizon that it currently does not own.
Media and entertainment company Corus Entertainment Inc. (CJR_B.TO) gathered about 1 percent after reporting improved first-quarter net income of C$52.2 million or C$0.62 per share compared to C$50.5 million or C$0.61 per share last year.
In economic news from the U.S., the Labor Department said its producer price index dipped by 0.2 percent in December after falling by 0.8 percent in November. Economists had expected the index to edge down by 0.1 percent. Excluding the drop in food prices as well as a modest decrease in energy prices, the core producer price index inched up by 0.1 percent in December.
Meanwhile, a report from the Commerce Department showed that retail sales rose by 0.5 percent in December following a revised 0.4 percent increase in November. Economists had expected sales to edge up by 0.2 percent compared to the 0.3 percent growth originally reported for the previous month. Excluding a 1.6 percent increase in sales by motor vehicle and parts dealers, retail sales increased by a more modest 0.3 percent in December compared to a 0.1 percent drop in November. The increase in ex-auto sales matched economist estimates.
From the euro zone, Germany’s EU harmonized inflation increased less than initially estimated in December, final data from the Federal Statistical Office showed. The harmonized index of consumer prices (HICP), measured under the EU methodology, increased 2 percent on an annual basis in December, slower than the 2.1 percent growth estimated earlier. In November, the HICP had gained 1.9 percent.
A separate report from the Federal Statistical Office revealed that German economic growth eased more than expected last year, due to significant slowdown in economic activity in the second half of the year. The gross domestic product rose 0.7 percent in price-adjusted terms in 2012, much weaker than the 3 percent growth in 2011 and 4.2 percent expansion in 2010.
Meanwhile, U.K. consumer price inflation remained unchanged at 2.7 percent for the third month in a row in December, the Office for National Statistics said. The rate also came in line with economists’ expectations.
Elsewhere, exports from euro area increased for the first time in three months in November, Eurostat reported. Shipments rose by seasonally adjusted 0.8 percent month-on-month, partially offsetting the 1.2 percent decrease in October. On the other hand, imports fell 1.5 percent, following a 0.8 percent rise.
by RTT Staff Writer
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