Saturday, January 16, 2010
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VANCOUVER – The main Canadian benchmark ended the week lower as loan losses at the second-largest U.S. bank sparked the biggest sell-off on Wall Street so far this year, putting pressure on commodity stocks and the Canadian dollar.The S&P/TSX Composite index fell for the fourth session in the past five, losing 119.01 points, or one per cent Friday, to 11,685.97, and slipping into negative territory for 2010. The week began with a rally, as the index punched above the 12,000 level Monday morning for the first time since Sept. 2008. But just an hour into that session, the profit-taking began in earnest, as traders sensed that the latest leg of the bull market – a rise of 1,160 points since the end of October that lifted the index nearly 11 per cent – might have run its course. Half an hour later, the index had fallen below 12,000. When the week ended, it had given back 385 points, or 2.2 per cent.
If this is the beginning of a correction, traders on the Venture board have yet to really buy into it. The Venture index shot as high as 1,626.90 on Monday, its best level since Sept. 9, 2008. On Friday, the Venture composite slipped just 1.82 points to end the week down 0.7 per cent at 1,593.47, up 89 per cent from a year ago.
In New York, the Dow Jones Industrial Average shed 100.90 points, or 0.9 per cent, to 10,609.65, in its biggest one day drop of 2010, after JPMorgan Chase, the No. 2 U.S. bank, said its credit card, consumer lending and retail banking businesses actually lost money in the fourth quarter, weighed down by loan-loss provisions. The company still earned profits of $3.3 billion US, or 74 cents a share in the quarter, thanks to investment banking profits. But the woeful performance on the consumer side of the business was a reminder that the North American economy is still pretty far from okay.
The S&P 500 dropped the most since Dec. 17, closing down 12.43, or 1.1 per cent, to 1,136.03, while the Nasdaq composite trimmed 28.75, or 1.2 per cent, to 2,287.99. For the week, the Dow lost 0.1 per cent, the S&P 500 fell 0.8 per cent, and Nasdaq sank 1.3 per cent.
The February crude oil contract settled at $78 US a barrel, down $1.39, or 1. 8 per cent from Thursday, and down $4.75 from the previous Friday. February natural gas actually finished 6.4 cents higher for the week at $5.652 US per million Btu, with all the gains coming in Friday's session. February gold fell $12.50, or 1.1 per cent, to $1,130.50 US, to finish the week lower by 0.7 per cent.
All 10 Canadian sector indices fell Friday, with the S&P/TSX global gold group shedding two per cent, and the financials dipping 1.1 per cent. One bright spot on the Canadian mining scene was Williams Lake. Taseko Mines jumped 71 cents, or 16 per cent, to $5.17, after the B.C. government granted environmental approval for the $800-million Prosperity gold-copper project. The province expects the mine to add $340 million annually to provincial GDP over its 20-year life. Vancouver-based Fronteer Development Group rose 63 cents, or 13 per cent, to $5.42, after drilling 48.8 metres grading 4.23 grams per tonne of gold, including 15.2 metres grading 10.07 grams per tonne on its Long Canyon deposit in northeastern Nevada.
Shares of Leslie Blodgett's mineral make-up empire Bare Escentauls shot up $5.33, or 42 per cent, to $18.07 US after Shiseido launched a $1.7-billion US takeover offer. The deal would make the Japanese giant the world's fourth- largest cosmetics company after L'Oreal, Procter & Gamble, and Unilever.
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