Shares record sixth loss on benchmark index
San Francisco, CA -- (SBWIRE) -- 10/08/2012 -- Canadian stocks dropped again at the end of September based primarily on concerns about U.S. economic contractions; however, BlackBerry-maker Research In Motion provided a juicy surprise.
A decline of 21.39 points to 12,317 on the Standard & Poor’s/TSX Composite Index was the sixth loss over seven days for the Canadian benchmark. But overall September saw a gain of 3.1%, the index’s largest since January.
Worries about economic factors in the United States and Europe are weighing on Canadian investors, says Paul Harris, of Avenue Investment Management.
“U.S. economic numbers are mildly positive, then mildly negative,” the Toronto portfolio manager told Bloomberg. “They keep telling us they’re not going to be growing quickly and that weighs on the marketplace.
“With Europe, it’s one step forward and two steps back,” said Harris, whose company manages $279 million. “The issues are not being solved, so people are constantly worried.”
Lenders and energy companies led in the recent losses. Bank of Nova Scotia fell 1.5%, and the nation’s biggest lender, Royal Bank of Canada, lost 0.3%. Canadian Natural Resources Inc. dropped 1.7%, and Legacy Oil + Gas Inc. slipped 3.3%.
Worry about slow U.S. economic growth has pushed down oil prices, while other indicators offer few signs of hope. In August, U.S. consumer spending rose only slightly, suggesting little economic expansion. A measure of business sentiment also suggested a possible contraction. The Institute for Supply Management-Chicago Inc.’s barometer slipped to 49.7 in September from 53 in August.
On the bright side, RIM shares gained 8.1% on news that sales were better than expected. The BlackBerry-maker, based in Waterloo, Ontario, sold 500,000 more smartphones than observers had forecast for the second quarter. RIM shares on the Toronto Stock Exchange rose 8.1% to C$7.52.
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