01/31/2013 08:33 EST | Updated 04/02/2013 05:12 EDT

Stock markets fall: economic concerns, BlackBerry launch weigh on markets

TORONTO - The Toronto stock market ended January trading with a triple-digit slide, weighed down by U.S. economic concerns and uncertainty over how BlackBerry's new smartphones will be received by consumers.

The S&P/TSX composite index fell 109.21 points to 12,685.24 but still ahead for the month, while the TSX Venture Exchange slipped 0.94 of a point to 1,221.41.

The company formerly known as Research In Motion Ltd. (TSX:RIM) again weighed on the TSX, a day after the launch of its new BlackBerry 10 product lineup. BlackBerry's stock was down a further 94 cents or 6.78 per cent to $12.92 on very heavy volume of 13 million shares, after tumbling almost 12 per cent Wednesday.

"There’s a couple of reasons for the weakness we’re seeing (and) one of them is that it’s had a phenomenal run and investors are taking some profits," said Jennifer Dowty, portfolio manager at Manulife Asset Management.

But availability has become an issue as U.S. customers won't be able to get the BlackBerry Z10 until March, a month later than in Canada.

"Many analysts had anticipated the launch would be Canada and the U.S. at the same time and that would be in February. And then when we heard it’s not going to be occurring until mid-March in the U.S. That was certainly a disappointment," she said.

In recent weeks, RIM stock had soared 200 per cent from its 52-week low of $6.10 of last September in anticipation over the new product, seen as a make or break effort by the company. BlackBerry has lost market share to Apple's iPhone and the Galaxy brand of smartphones from Samsung.

The Canadian dollar closed above parity for the first time since the Bank of Canada signalled a week ago that interest rate hikes will likely occur later than previously thought because of economic weakness. The loonie moved up 0.42 of a cent to 100.27 cents US after Statistics Canada reported gross domestic product grew by 0.3 per cent in November, better than the 0.2 per cent reading that had been expected. Year over year, GDP was ahead by 1.3 per cent.

U.S. markets were lacklustre a day after data showed the U.S. economy stalled late last year, shrinking at an annual rate of 0.1 per cent from October through December for the first time since the recession ended.

The negative reading raised doubts about the sustainability of a rally that has seen the Dow industrials surge 6.3 per cent since the start of the year, climbing close to 14,000 and within touching distance of its record level.

The Dow Jones industrials gave back 49.84 points to 13,860.58, the Nasdaq slipped 0.18 of a point to 3,142.13 while the S&P 500 index shed 3.85 points to 1,498.11.

Traders also considered data showing that U.S. consumer spending rose 0.2 per cent last month, which was slightly slower than the 0.4 per cent increase in November.

Income jumped 2.6 per cent in December from November as companies accelerated dividend payments to beat the January rise in income tax rates. It was the biggest gain since December 2004.

And a day before the release of the U.S. employment report for January, the Labour Department said weekly applications for unemployment benefits leapt 38,000 to a seasonally adjusted 368,000. The increase comes after applications plummeted in the previous two weeks to five-year lows.

All TSX sectors were lower save for a slight gain in telecoms.

The gold sector led decliners, down about 1.6 per cent as bullion stepped back $19.60 to US$1,662 an ounce. Barrick Gold Corp. (TSX:ABX) faded 71 cents to C$21.76.

The energy sector was off 1.16 per cent with March crude 45 down cents to US$97.49 a barrel. Canadian Natural Resources (TSX:CNQ) fell $1.05 to C$30.12.

The April copper contract was down two cents at US$3.73 a pound after running ahead six cents on Wednesday. The base metals component fell almost one per cent and First Quantum Minerals (TSX:FM) gave back 42 cents to C$20.11.

Financials also weakened with Manulife Financial (TSX:MFC) down 23 cents to $14.40.

Sears Canada (TSX:SCC) shares dipped a penny to $9.54 after the retailer announced it is laying off 700 workers, the majority from their department stores. In a statement, Sears says the move is part of an initiative to restructure its business model and the job cuts will be across Canada.

North American markets ended the first trading month of the year higher as corporations delivered some better than expected earnings reports, U.S. politicians stopped the economy from going over the so-called fiscal cliff and agreed to an extension of the debt limit. And there were signs that China's economy is reviving.

The TSX is up a shade over two per cent for the month while the Dow industrials has jumped about 5.75 per cent.

Potash Corp. (TSX:POT) was also in focus after it reported fourth-quarter profit fell to US$421 million, or 48 cents per share, missing analyst estimates by nine cents a share. The result includes a US$41-million charge related to the settlement of antitrust claims in the United States as well as substantially lower revenue as customers delayed their buying decisions amid economic uncertainty. Revenue was $1.64 billion, down from $1.86 billion a year earlier, and also below analyst estimates and its stock was down 82 cents to $42.37.

United Parcel Service Inc. is reporting a fourth-quarter loss of $1.75 billion because of a $3-billion accounting charge for pension liabilities. Without the pension item, UPS said that it would have earned $2.05 billion, or $1.32 per share. Analysts had expected UPS to post adjusted earnings of $1.38 per share. UPS shares fell $1.94 to US$79.29.