The S&P/TSX composite index fell 102.38 points to 13,333.58 while the TSX Venture Exchange slipped 9.33 points to 2,027.3.
Nervousness over a looming Aug. 2 deadline to raise the limit or risk a default punished the American dollar, helping to send the Canadian currency up 0.27 of a cent to 106 cents US. The loonie earlier ran as high as 106.3 cents US, its highest level since early November 2007.
Both president Barrack Obama and House speaker John Boehner made televised pitches Monday night for their point of view. Obama said a compromise was needed to avoid a “reckless and irresponsible” outcome. Boehner appeared to dig in his heels, saying Obama would not get what he seeks.
That has led to fears the world’s largest economy could default on its financial obligations and send shockwaves throughout world markets.
“Right now, everybody’s just on pause, waiting to see what happens with the debt ceiling,” said Dan Neuger, head of U.S. and European active equities at PineBridge Investments in New York.
The telecom sector was down 2.2 per cent as Rogers Communications Inc. (TSX: RCI.B) said second-quarter profits slipped nine per cent to $410 million or 75 cents a share. But the results still came in above analyst expectations on an adjusted basis by four cents. Revenue increased three per cent to $3.12 billion, which was also above expectations but its shares lost $2.02 to $35.80.
The financials sector was also a major drag, down one per cent with Royal Bank down 67 cents to $52.15 while TD Bank (TSX: TD) fell $1.31 to $78.85.
The energy sector was off 0.95 per cent as oil prices gave up early gains and the September contract on the New York Mercantile Exchange was unchanged at US$99.20 a barrel. Suncor Energy (TSX: SU) lost 44 cents to C$39.
Oilsands operator Cenovus Energy Inc. (TSX: CVE) reported that its quarterly net profits soared to $655 million or 85 cents a share from $183 million or 24 cents a year earlier. Cash flow jumped to $939 million from $537 million. Its shares were down 82 cents to $37.10.
The base metals sector was down 0.95 per cent as copper prices headed higher with the September contract ahead seven cents to US$4.48 a pound. Inmet Mining fell $3.70 to C$66.30 after the miner reported second-quarter profits of $56 million on Monday, up from $51 million a year ago. But net income attributable to Inmet shareholders dropped 18 per cent from $56 million, or 86 cents per share, from $68.5 million, or $1.22 per share in the second quarter of 2010.
First Uranium Corporation (TSX: FIU) shares tumbled nine cents or 15.25 per cent to 50 cents after it said the South African National Nuclear Regulator has ordered the company to stop disposing waste at its tailings operations in the country. The Toronto company operates gold and uranium mines in South Africa.
The industrials sector was down 0.62 per cent with shares in Canadian National Railway Co. (TSX: CNR) down $2.16 to $73.08 after it reported quarterly earnings of $538 million or $1.18 a diluted share, up from $534 million or $1.13 a year earlier. Revenues at Montreal-based CN rose eight per cent to $2.26 billion. Excluding one time items, adjusted diluted earnings per share for the quarter rose to $1.26 from $1.13, which was slightly above analyst expectations.
The gold sector was down 0.4 per cent as bullion prices backed away from Monday’s latest record close, down $1.20 to US$1,611 an ounce. Goldcorp Inc. (TSX: G) faded 80 cents to C$49.79.
The tech sector rose 0.4 per cent. Research In Motion (TSX: RIM) told Twitter followers it will hold a social media event Tuesday night to promote upcoming BlackBerry devices, as the company undertakes severe cost-cutting measures. Its shares were up 59 cents to C$25.78 a day after announcing it was laying off 2,000 of its workers.
Information technology company CGI Group Inc. (TSX: GIB.A) said its third-quarter net earnings rose 37.9 per cent to $118.4 million. Revenue increased 15.1 per cent to $1.04 billion. Diluted earnings per share were rose to 43 cents, surpassing analyst expectations, compared with 30 cents a year earlier. Its shares rose 13 cents to $21.50.
New York markets were mainly lower amid a positive reading on U.S. consumer confidence with the Dow Jones industrials down 47.64 points to 12,545.16.
The Nasdaq composite index rose 3.34 points to 2,846.14 while the S&P 500 index slipped 1.06 points to 1,336.37. The U.S. Conference Board reported that its July confidence index rose to 59.5 from 57.6.
However, other data showed slipping confidence in Canada. The Conference Board of Canada said that its Index of Consumer Confidence dropped for a third straight month in July, this time falling 1.8 points to 81.3.
“Consumers continue to express uncertainty about future job prospects, despite strong job creation numbers so far this year,” it said in a release.
In other earnings news, Ford Motor Co. said its second-quarter profit dropped eight per cent from a year ago to US$2.4 billion or 59 cents a share as higher sales were offset by the cost of developing new products and expanding sales in Asia. Its shares were up a penny at US$13.18.
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