The Canadian Press - ONLINE EDITION

Gold stocks push TSX lower, financials rise as Scotiabank beats expectations

  • Print

TORONTO - Falling mining stocks helped push the Toronto stock market lower Tuesday, but the TSX found some lift from financials after Scotiabank posted earnings that beat forecasts.

The S&P/TSX composite index lost 57.67 points to 14,658.02 as Scotiabank (TSX:BNS) boosted its second-quarter net profit by 14 per cent to $1.8 billion.

Adjusted diluted earnings per share were $1.40, beating analysts’ estimates of $1.31 a share. However, the provision for credit losses was up $32 million to $375 million in the quarter, primarily due to higher provisions in its international banking segment. Scotiabank shares were up 77 cents to $68.77.

The strong showing followed reports last week from Royal Bank (TSX:RY) and TD Bank (TSX:TD), which also beat expectations.

"All three of them had really strong beats, so we’re batting 1,000 so far for banks," said Ben Jang, portfolio manager at Nicola Wealth Management in Vancouver.

After markets closed, National Bank (TSX:NA) said it would increase its quarterly dividend two cents to 48 cents per share despite reporting a decrease in second-quarter net income to $362 million or $1.01 per diluted share from $417 million or $1.20 per share in the second quarter of fiscal 2013.

However, excluding certain items, the bank said profit would have been $375 million or $1.05 per share, up from $352 million or $1 per share a year earlier. That beat analyst expections of $1.04 per share in adjusted earnings, although revenue of $1.276 billion came in below estimates of $1.34 billion.

Bank of Montreal (TSX:BMO) reports on Wednesday, while the last of the big banks, CIBC (TSX:CM), reports on Thursday.

The Canadian dollar drifted 0.01 of a cent lower to 92.07 cents US.

U.S. indexes were higher amid a mixed reading on U.S. durable goods orders as traders got back to work following the Memorial Day holiday weekend.

The Dow Jones industrials was ahead 69.23 points to 16,675.5, the Nasdaq ran up 51.26 points to 4,237.07 and the S&P 500 index gained 11.38 points to a record-high close of 1,911.91.

The U.S. Commerce Department reported Tuesday that orders for durable manufactured goods rose 0.8 per cent after a 3.6 per cent gain in March. But the April strength came from a big jump in demand for defence goods, including airplanes. Excluding defence, orders would have fallen 0.8 per cent in April.

Orders for core capital goods, a category viewed as a good proxy for business investment plans, fell 1.2 per cent in April.

Meanwhile, the Case-Shiller house price index showed that prices rose 0.9 per cent in March.

And there has been a slight uptick in U.S. consumer confidence in May. The Conference Board’s measure of sentiment edged up marginally to 83 from a downwardly revised 81.7 in April.

The gold sector was the biggest drag, down about four per cent as June bullion fell $26.20 to US$1,265.50 an ounce — its lowest close since Feb. 7 — as risk concerns about Ukraine abated somewhat after elections over the weekend yielded a clear winner.

"We’re pretty much range-bound from here and, from the equities’ perspective, we still need to see higher sustained gold prices because the marginal cost of production of gold is very high relative to the price of gold today," Jang said.

Further, gold failed to find lift from news of increased violence as fighting between Ukrainian troops and separatist rebels reportedly killed dozens in the eastern city of Donetsk.

An easing of Ukraine concerns also pushed July crude oil in New York down 24 cents to US$104.11 a barrel and the energy sector dropped 0.84 per cent.

The base metals sector gave back some of last week's 3.3 per cent run-up, down 0.49 per cent even as July copper was up a penny at US$3.18 a pound.

There was also major buying activity in the food business as poultry producer Pilgrim’s Pride offered to acquire meat producer Hillshire Brands in a deal worth about US$5.58 billion. Pilgrim’s Pride says the deal is a better offer than Hillshire’s plan to buy Pinnacle Foods for $4.23 billion. Pinnacle makes Birds Eye frozen vegetables and Duncan Hines cake mixes.

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes

    No

  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.

letters

Make text: Larger | Smaller

LATEST VIDEO

Winnipeg Cheapskate: Cheap summer weekends

View more like this

Photo Store Gallery

  • A goose heads for shade in the sunshine Friday afternoon at Woodsworth Park in Winnipeg - Day 26– June 22, 2012   (JOE BRYKSA / WINNIPEG FREE PRESS)
  • Marc Gallant / Winnipeg Free Press. Local- WINTER FILE. Snowboarder at Stony Mountain Ski Hill. November 14, 2006.

View More Gallery Photos

Poll

Should Manitoba support the transport of nuclear waste through the province?

View Results

Ads by Google