TSX down amid fiscal cliff fears

The Toronto stock market was lower Tuesday as positive economic data was trumped by uncertainty surrounding negotiations aimed at steering the U.S. economy away from a fiscal crisis at the end of next month.The S&P/TSX composite index was 19.75 points lower to 12,165.3. Weakness was offset somewhat by a gain of almost nine per cent in Bombardier Inc. (TSX:BBD.B) shares to $3.40.The transport giant announced what it calls the biggest sale of business aircraft its history — a firm order by charter company VistaJet for 56 Bombardier Global jets valued at $3.1 billion along with options for 86 others. The deal could potentially be worth up to $7.8 billion if all options are exercised.The TSX Venture Exchange was down 5.84 points to 1,219.91.The Canadian dollar dipped 0.01 of a cent to 100.61 cents US.U.S. indexes were lacklustre despite a string of positive data and relief that eurozone officials have agreed on getting the next instalment of crucial bailout money to Greece.The Dow Jones industrials were down 30.3 points to 12,937.07, the Nasdaq composite index off 2.6 points at 2,974.19 and the S&P 500 index 2.11 points lower at 1,404.18.The U.S. Commerce Department says that orders for core capital goods, which are considered a proxy for business investment, rose 1.7 per cent in October, the largest amount in five months. Orders in this category had slowed beginning in the spring, acting as a drag on overall economic growth.Total orders for durable goods were unchanged in October against a 0.4 per cent drop that economists had expected.Also, there was more evidence of a housing recovery as Standard & Poor’s/Case-Shiller reported that home prices increased in September in most major U.S. cities.U.S. consumer confidence rose this month to its highest level in almost five years, pushed up by steady improvement in hiring. The Conference Board says its consumer confidence index rose to 73.7 in November from 73.1 in October. Both are the best readings since February 2008.Investors continued to monitor negotiations over the U.S. budget. Congressional Democrats and Republicans have yet to come to an agreement to prevent going off a so-called “fiscal cliff” of automatic tax increases and spending cuts at the start of next year. Economists say the combination would represent a shock sufficient to send the U.S. back into recession.“Overall, people are just risk averse — until we get some sort of a deal it’s probably going to stay this way,” said Ian Nakamoto, director of research at MacDougall, MacDougall and MacTier. “The longer we wait, the more uncertainty this means. Businesses clamp down, they don’t expand, they don’t hire.”Research in Motion Ltd. (TSX:RIM) (NASDAQ:RIMM) also weighed on the TSX as its stock moved down 6.4 per cent to $11.11 after soaring more than 25 per cent over the previous six sessions. RIM found lift from a variety of analyst upgrades amid optimism about the launch of its new BlackBerry 10 operating system, which will be unveiled at a Jan. 30 event along with its new line of smartphones. It’s viewed as a make or break product launch for Research In Motion.The gold sector was down one per cent as commodities shed early gains and the December bullion contract on the New York Mercantile Exchange declined $4.80 to US$1,744.80 an ounce. Goldcorp Inc. (TSX:G) faded 77 cents to C$40.01 while Agnico Eagle Mines (TSX:AEM) fell 87 cents to $56.02.The mining sector was off 0.64 per cent with December copper down one cent at US$3.54 a pound. First Quantum Minerals (TSX:FM) declined 37 cents to C$21.09 and Major Drilling Group (TSX:MDI) fell 35 cents to $9.01 as the company reported lower earnings and revenue for the latest quarter. It noted that “many mining companies did not extend their activities beyond their original budgets.” It also warned of weakness in the third quarter, which is seasonally the weakest of the year.The energy sector was flat as the January crude contract on the New York Mercantile Exchange moved down 77 cents to US$86.97 a barrel. Cenovus Energy (TSX:CVE) slipped 32 cents to C$32.49.Meanwhile, after three weeks of negotiations, Greece’s euro partners and the International Monetary Fund agreed early Tuesday to release loan payments totalling €44 billion and introduce a series of measures designed to reduce the country’s massive debts to a more manageable level within a decade. These include reducing the interest rates Greece has to pay on the loans and a still-vague bond buyback program.Without the bailout money, the country would be facing bankruptcy together with a possible exit from the 17-country eurozone, with potentially chaotic repercussions for the world economy. Traders also digested a new forecast warning the world’s economic recovery will be “hesitant and uneven” next year.The Organization for Economic Co-operation and Development adds that the 17-country eurozone is expected to struggle further next year despite recent positive steps to stabilize its government debt crisis. It forecasts a 0.4 per cent contraction this year in the eurozone and a 0.1 per cent fall next year.Elsewhere, the OECD is predicting the U.S. economy will grow two per cent next year while Canada’s economy will grow by 1.5 per cent in the final three months of this year, and advance only 1.8 per cent in 2013. The global economy is expected to grow 3.4 per cent next year.European bourses were mixed with London’s FTSE 100 index up 0.2 per cent, Frankfurt’s DAX 0.53 per cent higher and the Paris CAC 40 down 0.07 per cent.

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