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Stocks lower in early trading as National Bank (T.NA) beats earnings expectations

Canadian Press, The Canadian Press
0 Comments| August 27, 2014

TORONTO _ The Toronto stock market chalked up a small loss Wednesday following another record-high close as traders continued to digest earnings reports from the Canadian banking sector, in this case a solid report from National Bank (TSX: T.NA, Stock Forum).

The S&P/TSX composite index cancelled out most of Tuesday's 20-point rise, declining 18.6 points to 15,600.61,

The Canadian dollar was up 0.49 of a cent to 91.8 cents US.

U.S. indexes were little changed with the Dow Jones industrials off 2.54 points to 17,104.16, the Nasdaq declined 2.78 points to 4,567.86 and the S&P 500 index dipped 0.64 of a point to 1,999.38.

Quebec-based National Bank posted net earnings of $441 million, up 10 per cent from a year ago. Adjusted earnings came in at $1.20 a share, nine cents ahead of estimates.

Total revenues for the country's sixth largest lender were $1.42 billion, up from $1.29 billion in the same period last year.

The bank's return on equity for the quarter was 19.4 per cent compared with 20.1 per cent year-over-year, and its shares gained 77 cents to $50.17.

National Bank's earnings followed reports from Royal Bank of Canada (TSX: T.RY, Stock Forum, which on Friday posted a record quarterly profit that beat expectations and a dividend increase. Bank of Montreal (TSX: T.BMO, Stock Forum) and Bank of Nova Scotia (TSX: T.BNSStock Forum) reported mixed results Tuesday. None of those results have resulted in big stock moves with expectations elevated for a sector that is up 12 per cent year to date. CIBC (TSX: T.CM, Stock Forum) and Toronto-Dominion Bank (TSX: T.TD, Stock Forumreport on Thursday.

In the U.S., luxury retailer Tiffany & Co. (NYSE: TIFStock Forumreported earnings of $124.1 million or 96 cents a share in its fiscal second quarter, beating estimates by a dime. The company posted revenue of $992.9 million in the period, also surpassing expectations.

In other corporate news, workers at Bombardier Inc. (TSX: T.BBD.BStock Forum
in Thunder Bay, Ont., have rejected the latest offer from the transportation company. Unifor says the company's demands for concessions would hit all workers and retirees enrolled in the company's benefit plan. The workers have been on strike since July 14. The Thunder Bay light rail facility builds new subway and streetcars for the Toronto Transit Commission, as well as cars for Ontario's GO train commuter service. Bombardier shares dipped a penny to $3.80.

Uranium miner Cameco Corp. (TSX: T.CCOStock Forumsaid Wednesday it its preparing to stop work at its McArthur River mine and Key Lake mill operations in northern Saskatchewan due to a labour dispute. It said the company and the roughly 535 unionized workers represented by the United Steelworkers are set to begin a strike-lockout at 12:01 a.m. on Aug. 30.

Cameco said a labour disruption is not expected to affect its 2014 uranium delivery commitments. Its shares fell 43 cents to $21.48.

On the TSX, industrials led decliners, down 0.25 per cent.

The energy sector declined 0.15 per cent while October crude in New York was up nine cents to US$93.95 a barrel.

The base metals sector was positive, up 0.25 per cent even as December copper was down two cents to US$3.19 a pound.

The gold sector was flat while December bullion gained 70 cents to US$1,285.90 an ounce.


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