New York struggles with bleak U.S. job numbers
Toronto keeps triple-digit gains while New York battles bad jobs report
By David Friend
THE CANADIAN PRESS
TORONTO – The Toronto stock market held onto triple-digit gains in the afternoon while New York struggled to hang onto a brief surge of energy that quickly faded away.
Dismal jobs data stateside left the U.S. markets wavering while a neutral report received a better response in Canada.
Toronto's S&P/TSX composite index rose 135.8 points to 13,687.1 after Statistics Canada said the Canadian unemployment rate rose to 6.0 per cent in March from 5.8 per cent in February.
The agency said the increase resulted from an inflow of job seekers, while the economy added 14,600 net jobs last month.
The Canadian dollar was down 0.34 cent at 99.12 cents US.
Meanwhile, U.S. employers cut 80,000 jobs, the most in five years and the third straight month of job losses. The American unemployment rate jumped to 5.1 per cent from 4.8 per cent.
New York's Dow Jones industrial average stumbled throughout the day, rising out of the red during the lunch hour but then losing momentum barely an hour later, ahead 30.53 points at 12,656.56 in the afternoon.
The Nasdaq composite index edged up 18.58 points to 2,381.88 and the S&P 500 took a gain of 7.26 points to 1,376.57.
Analyst estimates of the number of American jobs lost last month had ranged widely from 15,000 to 150,000, with a general expectation of about 50,000 net losses.
The economy has given up jobs the first three months of this year, and the latest report adds fuel to the belief of many economists that the U.S. is already in recession.
"The economic data is negative, but I think what the market's telling us is we've priced in a lot of the bad news already," said Arthur Hogan, chief market strategist at Jefferies & Co. "You could make the argument that we've thrown a lot of difficult news at this market and it's reacted very well."
On the TSX, the energy sector gained two per cent as the May crude contract on the New York Mercantile Exchange rose $2.22 to US$106.05 a barrel.
The gold index rose 1.7 per cent with bullion prices for the June contract on the Nymex adding $7.70 to US$917.30 an ounce. Barrick Gold Corp. (TSX: ABX) was up 71 cents to $44.12.
Other stocks giving the Toronto market a lift included fertilizer producer Potash Corp payday loans in 1 hour. (TSX: POT) which climbed $5.10 to $173.87 as the fertilizer company's benefited from higher prices for potash. Fellow potash maker Mosaic Co. (NYSE: MOS) posted fiscal third-quarter profit which jumped more than tenfold.
Elsewhere on the TSX, Allen-Vanguard Corp. (TSX: VRS) was up four cents to $3.55 after reducing the ongoing price it is paying for the takeover last June of Hazard Management Solutions. Shares rose three cents to $3.54.
Ceramic Protection Corp. (TSX: CEP), a maker of protective armour for soldiers and military equipment, reported a 2007 net loss of just over $11 million as revenue rose 12 per cent to $86.2 million. Shares in the company rose two per cent, or five cents, to $2.30.
In takeover news, Draxis Health Inc. (TSX: DAX) has received a US$255-million offer from Jubilant Organosys Ltd., a publicly traded company based in India that is offering US$6 per share (C$6.05 at current exchange rages) for the Canadian company. Shares were slightly below the offer price at C$5.94, up $1 or 20 per cent.
Atrium Innovations Inc. (TSX: ATB) will now be a pure-play health and nutrition company after selling its active ingredients and specialty chemicals division to AXA Private Equity for expected total proceeds of US$165 million. Shares moved up seven per cent, or $1.17, to $16.76.
Ahead of the American jobless data, cellphone maker Motorola Inc. said it is laying off 2,600 more workers, bringing its payroll cuts to more than 10,000 since last year.
The Home Depot Inc. also said further job cuts could be in the pipeline as it restructures its human resources function at U.S. stores, though at this point it was unclear how many. This week it notified about 2,200 employees who will be affected by the changes, which will be completed by May 1.
In other disquieting U.S. news, the American Bankers Association said debtors fell behind on car, home equity and home improvement loans in last quarter of 2007 at a delinquency rate not seen since the recessionary early 1990s.
James Chessen, the group's chief economist, said the rise in consumer credit delinquencies is consistent with a rapidly slowing economy.
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