Americas Markets Fall as Wall Street Struggles
sg.biz.yahoo.com Saturday February 8, 9:34 AM A Wall Street Journal Online News Roundup
Americas markets fell Friday, tracking Wall Street lower after a terror alert from the Bush administration and the release of mixed U.S. economic data.
In Toronto, the S&P/TSX index fell 0.2% to 6477.74, as downward pressure from New York was offset by strength in the energy and health-care sectors.
The Dow Jones Industrial Average sank 65.07 points to 7864.23, its lowest close since Oct. 11.
Six of Toronto's 10 sector fell and one, information technology, remained unchanged. The energy sector rose 0.4%. In the group, EnCana rose 37 Canadian cents to C$47.48, Shell Canada rose 29 Canadian cents to C$46.00 and Petro-Canada rose 35 Canadian cents to C$50.90.
John Kinsey, portfolio manager at Caldwell Securities, said the threat of war in the Middle East continues to firm up oil and gas prices.
But the biggest winner of the day was the health-care sector, which rose nearly 3%, on heavyweight pharmaceutical company Biovail's announcement of final U.S. regulatory approval for its key hypertension product, Cardizem LA. The stock gained C$4.43 to C$47.48.
Meanwhile, the industrials sector shed 0.9%, as airline Air Canada gave up another 42 Canadian cents to C$42.65 after reporting a huge fourth-quarter loss and announcing possible asset sales Thursday.
In Mexico City, the key IPC index fell 0.5% to 5866.03. Most Mexican stocks followed U.S. counterparts lower, but broadcaster TV Azteca posted sharp gains as investors cheered its plan to pay dividends.
TV Azteca's CPOs soared 8.7% to 3.25 pesos after the company announced its board has approved plans to use a large chunk of its anticipated free cash flow over the next six years to pay shareholders more than $500 million in dividends on a regular basis. The broadcaster plans to use an additional $250 million of free cash to pay down its $647 million debt load.
Merrill Lynch raised its recommendation on the stock Friday to "buy" from "sell" based on the plan. Merrill also upgraded retailer Elektra, which has the same chairman as TV Azteca, to "buy" from "sell," citing a "halo effect" from the greater cash-flow discipline at its sister company. Elektra's shares rose 3.8% to 21.80 pesos.
Among decliners, cement group Cemex's CPOs shed 2.9% to 39.13 pesos and retailer Walmex's V shares dropped 2.1% to 23.86 pesos.
The main Bovespa index in Sao Paulo lost 1.8% to 10380.59 despite news Brazil hiked its 2003 primary budget-surplus target to 4.25% of gross domestic product -- higher than market expectations of 4%, according to a central bank survey.
The new goal exceeds the 3.75% level mandated in a $30 billion International Monetary Fund rescue package brokered in August and reassures investors the new government of Luiz Inacio Lula da Silva is working to ease the weight of Brazil's hefty debt load.
Elsewhere in the region and unlike its neighbors, Argentina saw it Merval Index add 1% to 564.89. Perez Companc, the market's most liquid share, rose 1.3% to 2.29 Argentine pesos.
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