Toronto stock market set for lower open amid mixed earnings, commodity prices

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Toronto stock market set for lower open amid mixed earnings, commodity prices

TORONTO - The Toronto stock market headed for a lower start to trading Tuesday following three days of solid gains.

Traders looked to little movement in commodity prices, mixed earnings news from the U.S. and largely shrugged off moves to stimulate the economy by the Bank of Japan.

The Canadian dollar rose 0.04 of a cent to 100.72 cents US a day before the Bank of Canada makes its next announcement on interest rates.

U.S. futures were soft as traders got back to work after the Martin Luther King holiday.

The Dow Jones industrial futures declined 15 points to 13,561, the Nasdaq futures added two points to 2,735.8 while the S&P 500 futures dipped 1.25 points to 1,477.75.

Earnings news was mixed as The DuPont Co. said net income for the quarter ending Dec. 31 of $111 million, or 12 cents per share. That’s down from $373 million, or 40 cents per share, for the fourth quarter of 2011.

The results beat the consensus estimate of Wall Street analysts of 7 cents per share. Sales for the quarter were flat at $7.3 billion and its shares were ahead 1.4 per cent in pre-market trading in New York.

Shares in Johnson & Johnson were down one per cent as the health care products company posted quarterly earnings of $2.57 billion, or 91 cents a share, up from $218 million, or eight cents a share a year ago. Excluding about $800 million in one-time acquisition and litigation charges, earnings in the latest quarter would have been $3.38 billion, or $1.19 per share. That beat the expectation of analysts by two cents per share.

In Canada, investors looked ahead to earnings from Canadian National Railways (TSX:CNR).

Traders will also take in results Tuesday from Google and IBM.

Commodities were mixed with February crude on the New York Mercantile Exchange off four cents to US$95.52 a barrel.

The March copper contract in New York was up one cent sot US$3.69 a pound while February bullion gained $4 to US$1,691 an ounce.

Markets failed to find lift from an announcement from the Bank of Japan that it has set a two per cent inflation target and implemented open-ended asset purchases that will pump money into the financial system.

The inflation target is aimed at helping the country emerge from its prolonged bout of deflation.

Japan's central bank has not achieved even its one per cent inflation target, with price increases hovering below 0.5 per cent for the past two years despite surges in energy costs.

In the wake of the news, Japan’s Nikkei 225 index finished the day down 0.4 per cent. Australia’s S&P/ASX 200 rose marginally, Hong Kong’s Hang Seng reversed morning losses to rise 0.3 per cent while mainland Chinese shares fell. The Shanghai Composite Index lost 0.6 per cent while the smaller Shenzhen Composite Index lost 1.4 per cent.

European bourses were lower even as a closely watched survey showed an unexpectedly sharp rise in German investor confidence.

The ZEW institute said Tuesday its indicator of economic sentiment rose by 24.6 points in January over the month before to an overall 31.5 points, its highest level since May 2010. Economists had predicted a more modest rise to 12 points.

London's FTSE 100 index dipped 0.06 per cent, Frankfurt's DAX fell 0.49 per cent while the Paris CAC 40 was down 0.54 per cent.

In other corporate news, Inmet Mining Corp. (TSX:IMN) says a number of parties have expressed an interest in offering an alternative to the hostile $5.1-billion takeover proposed by First Quantum Minerals (TSX:FM). Inmet says several unidentified parties are examining confidential information and discussions are ongoing. Inmet says its shareholders should reject First Quantum’s offer of about $72 per Inmet share.

Walmart Canada will continue to expand its presence over the next year, which will mark the arrival of its main U.S. rival — Target. Walmart plans to complete at least 36 additional supercentre projects by the end of next January _ bringing the total number of locations by then to 388.

True North Commercial Real Estate Investment Trust (TSXV:TNT.UN) is acquiring five office and retail properties across the country for $144.7 million. The acquisitions will be made through a combination of $50.1 million in cash and $94.6 million of new mortgage debt, including a vendor take-back mortgage of $1.7 million in the case of one of the properties.

Organizations: Bank of Japan, TSX, Bank of Canada Dow Jones Canadian National Railways Inmet The DuPont Co. Google IBM New York Mercantile Exchange Walmart Shanghai Shenzhen ZEW institute FTSE 100 First Quantum Minerals Target North Commercial Real Estate Investment Trust

Geographic location: Toronto, U.S., New York Canada Japan London Frankfurt

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