The Toronto stock market appeared set for a negative session Friday as commodity prices stepped back as relief over an agreement to deal with the European debt crisis faded.
The Canadian dollar was down 0.21 of a cent to 100.67 cents US after closing above parity with the American currency Thursday for the first time since Sept. 20.
U.S. futures were also weak as the Dow Jones industrial futures dropped 62 points to 12,106, the Nasdaq futures were down 12.75 points to 2,381 and the S&P 500 futures lost 7.4 points to 1,275.2.
Global stock markets racked up solid advances Thursday after eurozone leaders unveiled a plan to cut Greece’s debt, increase the firepower of the continent’s bailout fund to C1 trillion euros and strengthen the region’s banks, partially so they can sustain deeper losses on Greek bonds.
The TSX jumped 279 points while the Dow industrials surged 339 points.
However, investors stepped back Friday after analysts raised questions about the lack of detail in the plan.
Confidence was further undermined after Italy saw its borrowing costs rise in a sale of €7.9 billion in sovereign debt. The interest rate demanded by investors to lend the Italian government 10-year money topped 6%, surpassing the 5.86% rates paid a month ago.
Italy has seen its borrowing costs rise under pressure from Europe’s sovereign debt crisis. The European Central bank for weeks has been buying Italian bonds to keep rates at manageable levels.
Oil prices dropped well below US$93 a barrel Friday amid doubts that the plan to contain the debt crisis will help boost global economic growth.
The December crude contract on the New York Mercantile Exchange lost $1.63 to US$92.33 a barrel after running up almost $4 Thursday.
Metal prices also backed off from Thursday’s strong advances as December copper declined six cents to US$3.63 after gaining 20 cents.
December gold was $8.70 lower to US$1,739 an ounce.
It was a relatively light day for earnings news.
Wood panel maker Norbord Inc. (TSX:NBD) said Friday that its losses were US$1 million or two cents per share in the three months ended Oct. 1, an improvement from the $4 million loss handed in a year earlier. The company is still feeling the pressure of a depressed U.S. housing market.
And in the U.S., appliance maker Whirlpool Corp. said Friday it will cut 5,000 jobs, about 10% of its workforce in North America and Europe, as it faces soft demand and higher costs for materials.
Whirlpool also cut its 2011 earnings outlook drastically and reported third-quarter results that missed expectations as third-quarter net income more than doubled to $177 million while revenue rose two per cent to US$4.63 billion.
Earlier in Asia, Japan’s Nikkei 225 index jumped 1.4%, Hong Kong’s Hang Seng gained 1.7% and South Korea’s Kospi rose 0.4%.
Australia’s S&P/ASX 200 gained 0.1% and the Shanghai Composite Index added 1.6%.
London’s FTSE 100 index gained 0.28%, Frankfurt’s DAX dipped 0.12% and the Paris CAC 40 was down 0.51%.
In other corporate news, Mosaid Technologies Inc. (TSX:MSD) has received a $590-million offer from U.S. private equity firm Sterling Partners, which is bidding nearly 10% more than Mosaid’s rival Wi-LAN Inc. (TSX:WIN). Sterling is offering $46 cash per Mosaid share, $4 more than Wil-LAN’s latest offer.
ATS Automation Tooling Systems Inc. (TSX:ATA) said Friday it is reducing workdays at Photowatt France, its struggling solar energy subsidiary, as demand weakens. The facility will operate at about one-third of its production capacity.