Source: The Canadian Press

The Toronto stock market closed lower Wednesday, led by mining stocks as Teck Resources (TSX:TCK.B) delivered a disappointing earnings report and copper prices fell back from record levels.

The S&P/TSX composite index fell 108.22 points to 13,784.3 while the TSX Venture Exchange declined 27.11 points to 2,353.77.

Traders also took in merger news from the company that operates the Toronto stock market.

TMX Group (TSX:X) announced plans to merge with the London Stock Exchange to create the world’s biggest exchange operator for resource stocks — key drivers of growth for both exchanges.

TMX shares were off early highs over $45 but still closed up $2.57, or 6.38%, at $42.85.

The merger, if approved, would give LSE shareholders just over 50% of the combined company’s stock.

“The Toronto and London stock markets were being marginalized,” said Ian Nakamoto, director of research at MacDougall, MacDougall and MacTier.

“The reality of the situation is that two of them are playing defence rather than offence. Both of them were losing market share, not only to the bigger exchanges like New York but also to other electronic trading platforms.”

At the same time, the New York Stock Exchange has confirmed talks with Germany’s Deutsche Bourse for a potential merger.

The Canadian dollar was up 0.07 of a cent at 100.61 cents US.

The base metals sector led decliners, down more than four per cent with the sector depressed by a poorly received earnings report from Teck Resources Ltd. (TSX:TCK.B), which reported a drop in its fourth-quarter profit, hit by a big charge related to the refinancing of its debt.

The mining company earned C$361 million, or 61 cents per diluted share, for the quarter, compared with a profit of $411 million, or 70 cents, a year ago.

Chief executive Don Lindsay told financial analysts Wednesday that Teck has no plans to further reduce its debt this year after cutting the amount it owed by $3.1 billion last year. Its shares fell $5.27, or 8.34%, to $57.95.

Lower copper prices also impacted the sector, with the March contract in New York off five cents to US$4.52 a pound after higher demand and supply concerns had pushed the metal to a record closing high of US$4.58 last Friday. Quadra FNX Mining (TSX:QUX) declined 42 cents to C$14.34.

Shares in agriculture company Agrium Inc. (TSX:AGU) rose $2.75, or almost three per cent, to $95.65 after it reported a record fourth-quarter profit on the back of strong fertilizer prices. The Calgary-based company handed in earnings of US$158 million, or $1 per share, compared with profits of $30 million, or 19 cents per share, a year ago.

“It had outstanding earnings,” Nakamoto noted.

“They beat not only analyst expectations but beat their own expectations.”

The energy sector was down 0.75% while the March crude contract on the New York Mercantile Exchange shed early gains to drop 23 cents to US$86.71 a barrel. The dip came even as a U.S. government report showed a smaller than expected increase in crude supplies. The Energy Information Administration reported a rise of 1.9 million barrels against an expected increase of 2.4 million barrels.

Crude has fallen sharply since jumping above US$92 to a 26-month high last week over concerns that protests in Egypt could disrupt Middle East crude supplies.

EnCana Corp. (TSX:ECA) fell 60 cents to C$30.65 while Canadian Natural Resources (TSX:CNQ) lost 33 cents to $43.42.

The gold sector was lower as bullion prices advanced with the April gold contract on the Nymex ahead $1.40 to US$1,365.50 after running up almost US$16 on Tuesday. Barrick Gold Corp. (TSX:ABX) faded 76 cents to $47.69 while Kinross Gold Corp. (TSX:K) declined 48 cents to $16.62.

Goldcorp Inc. (TSX:G) has sold its 10.1% equity interest in Osisko Mining Corp., representing approximately 38.6 million common shares. The shares were sold at $13.75 per share and Vancouver-based Goldcorp says it expects to receive about $530 million in cash. Its shares added three cents to C$42.79.

In other earnings news, WestJet Airlines Ltd. (TSX:WJA) gained $1.56, or 11.82%, to $14.76 per share after it reported its profits climbed 138% in the fourth quarter to $47.9 million, or 33 cents a share, as it raced past analyst expectations. Revenue increased to $692.8 million, from $570 million, helped by stronger passenger volumes.

New York markets were lacklustre after Ben Bernanke, the U.S. Federal Reserve chairman, told members of the House of Representatives that he expects unemployment to remain high for several years. Last week, the U.S. Labour Department said the unemployment rate dropped to nine per cent in January.

The Dow Jones industrials gained 6.74 points to 12,239.89.

The Nasdaq composite index dropped 7.98 points to 2,789.07 while the S&P 500 index lost 3.69 points to 1,320.88.

On the U.S. earnings front, Coca-Cola Co. reported its fourth-quarter net income more than tripled, helped by the acquisition of a bottler and by selling more drinks in North America. Its adjusted earnings matched Wall Street estimates but revenue beat by a small margin. Its shares rose 28 cents to US$63.15.