Newspaper article The Canadian Press

North American Markets Fall as Outlook for Chinese Economy Looks Soft

Newspaper article The Canadian Press

North American Markets Fall as Outlook for Chinese Economy Looks Soft

Article excerpt

NAmerican stock markets hit by China slowdown

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TORONTO - North American stock markets pulled back Thursday as signs of pressure on China's manufacturing sector weighed heavy.

Toronto's S&P/TSX composite index fell 55.23 points to close at 13,932.97, with nearly all sectors lower.

On Wall Street, the declines were more dramatic, with the Dow Jones Industrial Average dropping to a five-week low.

And the Canadian dollar inched above 90 cents US after sliding below the mark for the first time since mid-2009 earlier in the session. The loonie closed 0.09 of a cent lower at 90.10 cents US.

A preliminary reading of HSBC's purchasing managers' index for China dipped this month to 49.6, the lowest level since July. Numbers below 50 indicate contraction.

"Chinese economic growth remains impressive from an absolute sense, but the rate of growth has been waning and that has implications for commodity prices and therefore commodity producers," said Tim Caulfield, a vice-president and director of equity research at Franklin Bissett Investment Management.

"Commodity prices are holding in amid the Canadian dollar weakness, which is a best-case scenario for commodity exporters."

The March crude oil contract on the New York Mercantile Exchange gained 59 cents to settle at US$97.32 a barrel, its highest level so far this year. The TSX energy sector was down 0.01 per cent.

February gold bullion rose $23.70 to US$1,262.30 an ounce, helping to drive the TSX gold sector higher.

Barrick Gold (TSX:ABX) gained nearly three per cent to C$21.43 while Agnico Eagle Mines (TSX:AEM) rose 7.2 per cent to $33.91.

Copper fell five cents to US$3.29 a pound.

In New York, the Dow dropped 175.99 points to end at 16,197.35, while the Nasdaq shed 24.13 points to 4,218.87 and the S&P 500 index was off 16.40 points at 1,828.46.

Several U.S. companies were lower after reporting quarterly results, including KeyCorp, Johnson Controls and Jacobs Engineering.

In economic data, Statistics Canada says retail sales rose 0. …

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