The resource-heavy Toronto stock market looked set for a lower open Monday as commodities fell in the wake of weak Chinese trade data and disappointing Japanese growth for the fourth quarter.
The weak economic data from overseas coupled with Friday’s weak employment report pushed the Canadian dollar down 0.11 of a cent to 90.06 cents after sliding 0.1 per cent last week.
New York futures were also in the red as the Dow Jones industrial futures lost 22 points to 16,426, the Nasdaq futures slipped 0.5 of a point to 3,703.8 while the S&P 500 futures were off 2.5 points to 1,875.5.
Data released on the weekend showed China’s exports fell by an unexpectedly large 18 per cent in February.
China’s official 2014 economic growth target of 7.5 per cent assumes trade also will grow by 7.5 per cent. But customs data show combined imports and exports so far this year have shrunk by 4.8 per cent.
“The focus will likely remain on China in an otherwise quiet week, with January-February activity data due on Thursday,” said a commentary from Barclays Research.
“We expect the message to be moderately slower growth, given the soft demand outlook suggested by the recent PMI readings, and lower inflation.”
Meanwhile, Japan reported Monday a record current account deficit for January, and lowered its economic growth estimate for the October-December quarter to 0.7 per cent from one per cent.
Copper prices fell heavily for a second session in the wake of the Chinese data, with the May contract in New York losing another six cents to US$3.02 a pound. Prices for the metal tumbled 14 cents Friday after Chinese authorities allowed the country’s first corporate bond default, which fueled speculation as to how many more companies may be in a similar situation.
The weak overseas data pushed the April crude contract on the New York Mercantile Exchange down $1.30 to US$101.28 a barrel.
Bullion prices advanced with the April contract ahead $1.90 to US$1,340.10.
On the corporate front, satellite hardware developer Com Dev International (TSX:CDV) says quarterly net income dropped to $1.8 million, down nearly 55 per cent from the first quarter of fiscal 2013 as a stronger U.S. dollar weighed on results. Revenue was down one per cent from a year ago at $51.8 million.
The Second Cup Ltd. (TSX:SCU) recorded net income of $1.18 million or 12 cents a share, improved from the year earlier loss of $12 million a year ago when Second Cup recognized the impaired value of its assets. Adjusted earnings per share was 17 cents, down from 18.2 cents per share a year earlier.
European markets were mixed six days before a referendum will be held in Ukraine’s Crimean peninsula that will determine whether the territory becomes part of Russia.
London’s FTSE 100 gained 0.26 per cent, Frankfurt’s DAX fell 0.26 per cent and the Paris CAC 40 gained 0.58 per cent.
Earlier in Asia, Japan’s Nikkei 225 closed down one per cent, China’s Shanghai Composite plunged 2.9 per cent while Hong Kong’s Hang Seng dropped 1.8 per cent.