The Toronto stock market appeared set for a slide Monday as investor saw little in the way of Canadian economic data and focused on Italy’s debt problems.
Global stocks fell as Italy’s borrowing rates spiked Monday to their highest levels since the country adopted the euro. Markets fear that Italy’s debts are too large to be handled by an international bailout.
The Canadian dollar lost 0.04 of a cent to 98.32 cents US.
Oil prices added 31 cents to US$94.57 a barrel in pre-market trading, while gold jumped $19.20 to US$1,775.30 an ounce. Copper prices shed three cents to US$3.53 a pound.
On Wall Street, Dow Jones futures lost 40 points, to 11,901, while S&P 500 futures fell 6.6 points, to 1,244.5. Nasdaq futures dropped 8.2 points to 2,342.8.
Following last week’s turmoil centred on worries that Greece was heading for imminent bankruptcy, investor fears are now focused on Italy, the eurozone’s third-largest economy. Italy is also the third-biggest debt market in the world.
If its cost of borrowing rises too much, the country wouldn’t be able to raise the money it needs to roll over its debts, creating big problems for the European banking system and the global economy.
Greece has stepped back from the brink, promising to cobble together a unity government that looks like it will continue with fiscal reforms, but in Italy the government of Prime Minister Silvio Berlusconi faces a confidence vote this week.
In Canadian corporate news, RioCan Real Estate Investment Trust (TSX:REI.UN) tripled its third-quarter net earnings to $168 million, or 63 cents per unit, up from $56 million or 23 cents per unit a year ago, on various acquisitions.
Ensign Energy (TSX:ESI) said its net profit in the latest quarter was $64 million or 52 cents per share in the three months ended Sept. 30. That was double the $32 million, or 21 cents per share, the company made in the same quarter a year ago.
Monday is a quiet day for economic reports in both Canada and the United States, although the Federal Reserve will report in the afternoon on how much American consumers borrowed in September.
In Europe, France’s CAC-40 was 2.25% lower while Germany’s DAX fell 2.7%. Britain’s FTSE 100 lost 0.3%.
Earlier, Asian shares fell. Japan’s Nikkei 225 index dropped 0.4% to close at 8,767.09. South Korea’s Kospi lost 0.5% to 1,919.10 and Australia’s S&P/ASX 200 was down 0.2% at 4,273.40.
Hong Kong’s Hang Seng sank 0.8% to 19,677.89. Mainland China’s benchmark Shanghai Composite Index lost 0.7% to 2,509.80 and the Shenzhen Composite Index lost 0.6% to 1,065.31.