Wall Street lower after Fed rate easing
Dec 17, 2008 12:52 PM
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Malcolm Morrison
THE CANADIAN PRESS
The Toronto stock exchange is down – meaning today that its computers are not conducting trades, and have not been all morning.
"We've halted the Toronto stock exchange and TSX Venture Exchange and we will update you as soon as we are able," said Caroline Quick, director of communications at market operator TMX Group Inc. (TSX: X).
"It's a technical issue", she added, declining to elaborate.
Judging by the performance of Canadian bellwether stocks in New York, financials are a weight while energy stocks advanced.
Royal Bank was down 77 cents to US$28.33 while EnCana Corp. was ahead 37 cents to US$48.18 as the January crude contract on the New York Mercantile Exchange was off 70 cents at US$42.90.
The slippage in crude prices came even as the Organization of Petroleum Exporting Countries cut its output quotas by 2.2 million barrels a day. It's the largest-ever one-time reduction as the cartel struggles to support prices that have fallen from a peak of US$147 a barrel in July.
The Canadian dollar moved down 0.17 of a cent to 83.04 cents US after gaining two cents Tuesday.
New York stock markets moved lower, giving back a chunk of the previous day's gains that followed the U.S. Federal Reserve's cut in its key interest rate to between zero and 0.25 per cent to deal with a rapidly worsening economy.
The Dow Jones industrial average declined 108.2 points to 8,816 following a 359-point jump.
The Nasdaq composite index lost 19.63 points to 1,570.26 while the S&P 500 index declined 10.55 points to 902.65.
Traders digested much worse than expected results from Morgan Stanley, which lost US$2.37 billion as it endured a wide range of setbacks in one of the roughest quarters ever for investment banks. The loss of $2.34 per share was far below analyst expectations of a loss of 34 cents a share.
The February bullion contract in New York rose $27.50 to US$870.20 an ounce.
In corporate news, the Globe and Mail reported that Canadian Pacific Railway Co. (TSX: CP) plans to cut 600 union jobs and reduce other spending in tough times.
And insurer Kingsway Financial Services Inc. (TSX: KFS), under pressure from a major shareholder, says it is cutting costs by US$20 million next year.
Quebecor World Inc. (TSX: IQW) says Pierre Karl Peladeau and Erik Peladeau, heirs of founder Pierre Peladeau, have resigned from the commercial printer's board. This comes as former parent company Quebecor Inc., headed by the Peladeaus, sues Quebecor World, which is restructuring under bankruptcy protection.
On the earnings front, pharmaceutical company MDS Inc. (TSX: MDS) reported a fourth-quarter loss of US$255 million on a big after-tax writedown related to the troubled Maple medical-isotope reactor project. The results are preliminary and do not include another writedown of between $270 million and $370 million related to goodwill at its MDS Pharma Services division.
Transat AT Inc. (TSX: TRZ) said non-cash and non-operating items drove the travel operator into the red for its 2008 financial year, with a net loss of $50 million. Transat took a $45.7-million writedown on asset-backed commercial paper and a $2.3-million foreign exchange hit.
In the United States, Securities and Exchange Commission chairman Christopher Cox blamed regulators for a decade-long failure to investigate Wall Street money manager Bernard Madoff, now accused of a US$50-billion Ponzi scheme.
Markets overseas were mixed.
Japan's Nikkei stock average rose 0.5 per cent, while Hong Kong's Hang Seng index closed with a gain of 2.2 per cent.
The FTSE 100 declined 0.6 per cent in afternoon trading in London, while Germany's DAX index was off 0.5 per cent and France's CAC-40 was down 0.95 per cent.
Shares of BNP Paribas plunged 16 per cent after the French bank said extreme market volatility triggered a loss of US$972 million over the first 11 months of the year due to carnage in investment banking over the last two months.
Dec 17, 2008 12:52 PM
Be the first to comment on this article...
Malcolm Morrison
THE CANADIAN PRESS
The Toronto stock exchange is down – meaning today that its computers are not conducting trades, and have not been all morning.
"We've halted the Toronto stock exchange and TSX Venture Exchange and we will update you as soon as we are able," said Caroline Quick, director of communications at market operator TMX Group Inc. (TSX: X).
"It's a technical issue", she added, declining to elaborate.
Judging by the performance of Canadian bellwether stocks in New York, financials are a weight while energy stocks advanced.
Royal Bank was down 77 cents to US$28.33 while EnCana Corp. was ahead 37 cents to US$48.18 as the January crude contract on the New York Mercantile Exchange was off 70 cents at US$42.90.
The slippage in crude prices came even as the Organization of Petroleum Exporting Countries cut its output quotas by 2.2 million barrels a day. It's the largest-ever one-time reduction as the cartel struggles to support prices that have fallen from a peak of US$147 a barrel in July.
The Canadian dollar moved down 0.17 of a cent to 83.04 cents US after gaining two cents Tuesday.
New York stock markets moved lower, giving back a chunk of the previous day's gains that followed the U.S. Federal Reserve's cut in its key interest rate to between zero and 0.25 per cent to deal with a rapidly worsening economy.
The Dow Jones industrial average declined 108.2 points to 8,816 following a 359-point jump.
The Nasdaq composite index lost 19.63 points to 1,570.26 while the S&P 500 index declined 10.55 points to 902.65.
Traders digested much worse than expected results from Morgan Stanley, which lost US$2.37 billion as it endured a wide range of setbacks in one of the roughest quarters ever for investment banks. The loss of $2.34 per share was far below analyst expectations of a loss of 34 cents a share.
The February bullion contract in New York rose $27.50 to US$870.20 an ounce.
In corporate news, the Globe and Mail reported that Canadian Pacific Railway Co. (TSX: CP) plans to cut 600 union jobs and reduce other spending in tough times.
And insurer Kingsway Financial Services Inc. (TSX: KFS), under pressure from a major shareholder, says it is cutting costs by US$20 million next year.
Quebecor World Inc. (TSX: IQW) says Pierre Karl Peladeau and Erik Peladeau, heirs of founder Pierre Peladeau, have resigned from the commercial printer's board. This comes as former parent company Quebecor Inc., headed by the Peladeaus, sues Quebecor World, which is restructuring under bankruptcy protection.
On the earnings front, pharmaceutical company MDS Inc. (TSX: MDS) reported a fourth-quarter loss of US$255 million on a big after-tax writedown related to the troubled Maple medical-isotope reactor project. The results are preliminary and do not include another writedown of between $270 million and $370 million related to goodwill at its MDS Pharma Services division.
Transat AT Inc. (TSX: TRZ) said non-cash and non-operating items drove the travel operator into the red for its 2008 financial year, with a net loss of $50 million. Transat took a $45.7-million writedown on asset-backed commercial paper and a $2.3-million foreign exchange hit.
In the United States, Securities and Exchange Commission chairman Christopher Cox blamed regulators for a decade-long failure to investigate Wall Street money manager Bernard Madoff, now accused of a US$50-billion Ponzi scheme.
Markets overseas were mixed.
Japan's Nikkei stock average rose 0.5 per cent, while Hong Kong's Hang Seng index closed with a gain of 2.2 per cent.
The FTSE 100 declined 0.6 per cent in afternoon trading in London, while Germany's DAX index was off 0.5 per cent and France's CAC-40 was down 0.95 per cent.
Shares of BNP Paribas plunged 16 per cent after the French bank said extreme market volatility triggered a loss of US$972 million over the first 11 months of the year due to carnage in investment banking over the last two months.