TSX holds on, Dow slips after rise
Wal-mart’s disappointing report, Greek bailout reaction hurt optimism
The Dow Jones industrial average rose above 13,000 in early trading on Tuesday, but erased most of its gains after retail giant Walmart reported low prices hurt its margins and investors took a second look at the implications of the Greek bailout deal that caused the initial advances.
While the Dow dropped in later trading, Canada’s benchmark stock index held on to its gains, thanks to jumps in the prices of oil and gold.
The S&P/TSX composite index closed the day at a five-month high of 12,623.36, up 165.06 points, or 1.32 per cent. Seven of its 10 sub-indexes advanced, led by materials, which gained 3.03 per cent, and energy, which rose 1.33 per cent.
The Dow Jones industrial average swung between gains and losses in afternoon trading, ending with a gain of 15.82 points, or 0.12 per cent, at 12,965.69, while the Nasdaq edged downward by 3.21 points, or 0.11 per cent, to 2,948.57.
U.S. equities put in a largely flat performance on the day, discarding any cause for optimism in the first day of trading in a shortened week, Scotia Capital economists Derek Holt and Dov Zigler wrote in an afternoon note.
The main one related to disappointing U.S. earnings led by Walmart. european finance ministers may have approved a 130-billioneuro ($172 billion Cdn) bailout for Greece, but observers say that doesn’t address the country’s long-term problems.
“The Greek bailout keeps the wheels on the bus,” James Dunigan, chief investment officer in Philadelphia for PNC Wealth Management, told Bloomberg.
“The ride is a little smoother, but it doesn’t solve the longer-term issues.”
The price of crude oil closed Tuesday at $105.50 US a barrel, up $2.26 for the expiring March contract, and gold shot up $32.60 US to $1,757.10 US an ounce.
Canada’s junior Venture exchange rose 20.48 points, or 1.24 per cent, to 1,678.63.
The Canadian dollar slipped nine basis points to $1.0034 after Statistics Canada reported a decline in retail sales for December.