Newspaper article The Canadian Press

TSX in for Further Tepid Performance Following Mildly Positive First Quarter

Newspaper article The Canadian Press

TSX in for Further Tepid Performance Following Mildly Positive First Quarter

Article excerpt

TSX in for further tepid performance

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TORONTO - The Toronto stock market goes into the second quarter of 2013 trading down from its best levels of the year and not a great deal of hope that global economic conditions will improve to a point where the resource-based market can gain traction.

But during the coming week, traders will look to assurance that job growth remains strong while keeping a wary eye on countries most impacted by the eurozone debt crisis.

The TSX ended the January-March period up a slight per cent year to date, down from highs of mid-March when the market was ahead about 3.5 per cent.

In contrast, a stream of positive economic indicators, including a resurgent housing sector, and continued stimulus measures from the U.S. Federal Reserve helped power the Dow Jones industrials to a series of record-high closes, leaving the blue chip index up almost 12 per cent year to date.

But looking ahead, the resource-heavy TSX will continue to be hobbled by a stubbornly slow global economic recovery.

"I think it really is a function of commodity prices not really going anywhere because it's a tepid global recovery and most of the revisions in terms of growth expectations that occurred over the quarter have been downwards," said Norman Raschkowan, North American strategist at Mackenzie Investments.

"People initially had some positive adjustments to the view on China and now those have sort of reversed and for the U.S., things have been probably OK and data particularly on the housing side has been positive. I think that's been overwhelmed in the global context by the estimates for Europe being revised downwards pretty materially."

Miners led TSX losers by a long shot, with the Global Gold Index losing while the Metals and Mining group fell per cent.

However, it wasn't all bad news as the financial sector gained per cent while the energy component rose per cent.

At the same time, Raschkowan says that it's hard to see what can drive the U.S. market up from here. …

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