Source: The Canadian Press

Falling mining and energy stocks pushed the Toronto stock market lower Thursday as oil and bullion posted steep declines.

The S&P/TSX composite index fell 55.55 points to 13,410.2 while the TSX Venture Exchange lost 16.53 points to 2,233.97.

The Canadian dollar was stronger against the American currency, up 0.21 of a cent at 100.68 cents US.

Market heavyweight Potash Corporation of Saskatchewan Inc. (TSX:POT) was a rare bright light among resource stocks on Thursday after it announced its fourth-quarter profit more than doubled.

PotashCorp shares were up $4.88, or 2.92%, at $172.26. At one point, the stock almost hit $178 after the world’s biggest producer of potash, the nutrient used in fertilizer, said its net income was $482.3 million in the fourth quarter, or $1.61 per share. That was up from $239.2 million, or 79 cents per share, a year ago.

Sales were $1.8 billion, an increase from $1.1 billion from the comparable year-earlier period and above analyst expectations of about $1.65 billion. The company’s profit would also have beaten estimates except that last year’s battle to fend off a hostile takeover by BHP Billiton cut 16 cents per share from earnings.

The gold sector was the weakest group as the February gold contract on the New York Mercantile Exchange dropped US$14.60 to US$1,318.40 an ounce, its lowest settlement since Oct. 4.

Bullion prices fell after European Central Bank president Jean-Claude Trichet told the World Economic Forum’s annual meeting in Davos that major central banks “are very united in purpose to maintain price stability” and anchor inflation expectations. Gold saw sharp increases in 2010 as investors saw it as a hedge against inflation and against falling currencies.

Barrick Gold Corp. (TSX:ABX) faded $1.57 to C$46.02 while Goldcorp Inc. (TSX:G) lost 80 cents to $40.41.

Metal prices advanced with the March copper contract on the Nymex ahead seven cents at US$4.34 a pound. But the higher copper price wasn’t reflected in mining stocks, with the base metals sector down 1.38%. Teck Resources (TSX:TCK.B) stepped back $1.78 to C$59.13 while Thompson Creek Metals Co. Inc. (TSX:TCM) gave back 27 cents to $13.62.

The financials sector led advancers, up 0.48% as Royal Bank (TSX:RY) gained 56 cents to $53.46, while Scotiabank (TSX:BNS) climbed 48 cents to $56.63.

The tech sector was also supportive as Celestica Inc. (TSX:CLS) reported fourth-quarter revenue and adjusted profit that topped analyst expectations, although net income slipped from a year before. Net income was US$25.6 million, or 11 cents per share, compared with $31.1 million, or 13 cents per share, in the same period a year ago. Celestica’s shares jumped 49 cents to $9.91.

U.S. economic data on manufacturing and jobs, which missed expectations, helped push the March crude contract on the Nymex $1.69 lower to US$85.64 a barrel, its lowest close since Nov. 30. The energy sector dropped 0.9% and Suncor Energy (TSX:SU) lost 55 cents to C$38.55 while Canadian Natural Resources (TSX:CNQ) fell 74 cents to $41.90.

The session’s declines left the TSX at about where the main index started the year.

The inability to gain traction has many analysts thinking that the TSX, up well over 20% since the lows of last July without a serious test, is due for a stepback.

“I’m just amazed these markets are where they are — a healthy consolidation would be nice,” said Chris King, portfolio manager at Morgan, Meighen and Associates.

“It’s easy to be worried. The way I think it rolls out is that energy continues to do well, the financials will be fine. It’s the materials side, specifically a slowdown in China, I think is the most probable weakness ahead.”

U.S. markets were generally weak amid mixed earnings reports and economic data that disappointed.

The Dow Jones industrial average finished 4.39 points higher at 11,989.83.

The Nasdaq composite index rose 15.78 points to 2,755.28 while the S&P 500 index was up 2.91 points at 1,299.54.

The number of Americans applying for unemployment benefits rose sharply last week as snowstorms in some parts of the United States forced companies to lay off workers. Applications rose by a seasonally adjusted 51,000 to 454,000, the highest level since late October.

And the U.S. Commerce Department said that orders to factories for durable goods dropped 2.5% last month after an even larger, 3.1% decline in November.

On the U.S. earnings front, Microsoft ended the session up slightly as its earnings results were released earlier than expected. The software giant reported net earnings of US$6.63 billion, or 77 cents a share, up from 74 cents a year ago and better than analyst estimates of 68 cents. Its shares closed up nine cents at US$28.87.

Caterpillar more than quadrupled its fourth-quarter profit as stronger demand helped increase global sales of mining and construction equipment and its shares edged up 88 cents to US$96.63.

Procter & Gamble Co., the world’s largest consumer products maker, reported quarterly net income of $3.33 billion, or $1.11 per share, compared with $4.66 billion, or $1.49 per share last year. Revenue rose 2% to US$21.3 billion. Analysts expected US$1.10 per share on US$21.51 billion in revenue and its shares declined $1.93 to US$64.18.

In Canada, shares in forest products company Tembec Inc. (TSX:TMB) fell 66 cents or 13.95% to $4.07 as it said its first-quarter net loss deepened 33% to $12 million despite higher sales.