The Toronto stock market was unable to find direction at mid-morning Thursday as higher gold stocks competed with weakness in the financial and energy sectors.
The S&P/TSX composite index fell 4.37 points to 12,140.47, while the TSX Venture Exchange gained 13.48 points to 1,643.72.
The gold sector was the biggest gainer, climbing 1.9 per cent as the price of gold continued a rally that has seen the precious metal hit record high after record high.
The December bullion contract added $8.90 to US$1,277.60 an ounce, beating Tuesday’s all-time high. Shares in Barrick Gold Corp. (TSX: ABX) gained 81 cents to C$47.
The Toronto energy sector fell 0.2 per cent. The October crude contract on the New York Mercantile Exchange lost 79 cents to US$75.23 a barrel amid stubbornly high U.S. crude inventory surpluses. Shares in Encana Corp. gained 19 cents to C$28.18.
And the financial sector lost 0.8 per cent. Shares in Bank of Nova Scotia (TSX: BNS) lost 43 cents to $53.32.
Investors failed to find solace in data from the U.S. Labor Department that showed the number of newly laid-off workers seeking unemployment benefits dropped slightly last week to its lowest level in two months, a sign that employers are cutting fewer jobs.
Initial claims are still above levels that would signal widespread hiring. In a healthy economy, claims usually fall below 400,000.
“While the dip in initial claims is encouraging, we expect that the pace of improvement in economic activity going forward will not be sufficient to move the unemployment rate markedly lower in the near-term,” remarked Nathan Janzen from RBC Economics.
The unemployment claims joined a slew of other numbers released in recent weeks that have shown the economy south of the border is still growing, albeit slowly.
These numbers have prompted an unusual September rally that has seen the TSX gain 1.9 per cent and the Dow Jones climb an impressive 5.6 per cent so far this month.
A separate report Thursday showed U.S. wholesale prices increased a more-than-expected 0.4 per cent in August, which could be a concern for traders. Expectations have been growing in recent days that the Federal Reserve might resume some of its bond purchases to try and further stimulate the economy. If inflation becomes a concern, they might have to put those plans on hold.
And a report on manufacturing activity in the mid-Atlantic region of the U.S. showed contraction for the second straight month in September, though the Philadelphia Fed manufacturing index improved from August.
Toronto’s metals and mining sector added 0.7 per cent as the December copper contract gained five cents to US$3.51 a pound. Shares in Teck Resources Ltd. (TSX: TCK.B) added eight cents to C$39.76.
The Canadian dollar edged up 0.02 of a cent to 97.45 cents US.
On Wall Street, the Dow Jones industrial average fell 27.54 points to 10,545.19. The Nasdaq composite index was down 7.94 points at 2,293.38, while the S&P 500 lost 4.79 points to 1,120.28.
In corporate news, FedEx Corp. (NYSE: FDX) said its fiscal first-quarter earnings doubled, but the company plans to cut 1,700 jobs as it consolidates its trucking operations to save money. The company also raised its quarterly earnings outlook, but the forecast was still shy of analysts’ expectations.
Canadian energy company Enbridge Inc. (TSX: ENB) said it has finished repairs on a pipeline in Illinois that sprang a leak earlier this month and is working to return the line to service. The spill near Chicago followed a spill in Michigan, which was the subject of hearings by a congressional panel in Washington on Wednesday. Enbridge shares fell 42 cents to $51.82.
Power producer Boralex Inc. (TSX: BLX) said Wednesday that a majority of the units of Boralex Power Income Fund (TSX: BPT.UN) has been tendered to its takeover offer. Boralex shares gained 15 cents to $7.67, while units in Boralex Power added three cents to $5.01.
A business magazine reported that state-owned Chinese company Sinochem Corp. is seeking government approval to make a competing bid to BHP Billiton’s US$38.5-billion offer for Canada’s Potash Corp. of Saskatchewan (TSX: POT). PotashCorp shares added $1.62 to $152.14.
Shares in Augusta Resource Corp. (TSX: AZC) soared 45 cents or 14.2 per cent to $3.63 after a Korean consortium including LG International Corp. agreed to provide US$176 million to advance the company’s Rosemont copper-molybdenum project in Arizona.
And investors are awaiting results from BlackBerry-maker Research in Motion (TSX: RIM), scheduled to be released after markets close today. Shares in RIM added 38 cents to $47.09 ahead of its quarterly report.
Overseas markets slipped as well. Britain’s FTSE 100 fell 0.2 per cent, Germany’s DAX index fell 0.2 per cent, and France’s CAC-40 fell 0.5 per cent. Japan’s Nikkei stock average fell 0.1 per cent a day after it surged more than two per cent as the country’s government stepped in to weaken the currency. Hong Kong’s Hang Seng index lost 0.2 per cent.
