Energy and financial stocks, with help from tech shares, lead Canadian markets lower Thursday, while disappointing earnings in the tech sector did in U.S. markets.

At close, the S&P/TSX was off 31.37 points or 0.34% to 9088.98, while the TSX Venture dipped 3.72 points or 0.21% to 1790.01. In New York, the Dow Jones industrial average dropped 68.50 points or 0.65% to 10471.47, while the tech-heavy Nasdaq lost 27.71 points or 1.34% to 2045.88 and the S&P 500 slipped 9.22 points or 0.78% to 1175.41.

The Canadian dollar lost ground as the U.S. dollar strengthened. It was down 0.42 of a cent to US81.11¢ late n the session as manufacturing shipments rose a modest 0.2% in November to $50 billion. The US$, meanwhile, hit a two-month high against the euro on Thursday, buoyed by expectations for higher U.S. interest rates.

On Bay Street, the TSX energy subgroup was down 0.59% in late trading as oil prices declined below US$47 per barrel Thursday as traders tracked forecasts calling for milder weather and digested the latest U.S. energy supply report, which showed rising inventories of crude. Light, sweet crude for February delivery was down 64¢ to settle at US$46.91 per barrel on the New York Mercantile Exchange.

The heavily weighted financials group lost 0.47%, with Bank of Montreal losing 33¢ or 0.59% to $55.34 and Bank of Nova Scotia adding 4¢ or 0.1% to $39.84.

Other active stocks on the TSX included Molson Inc., whose stock was 4¢ or 0.11% to $37.60 as shareholders prepare to vote on the proposed merger with Adolph Coors Co.

Tech stocks slid 0.70%, despite a 1.6% jump in the value of Nortel Networks Corp. stock. It added 6¢ to $3.85 on volume of more than 8.4 million shares.

Tech shares were pulled down on both Canadian and U.S. markets by the disappointing earnings and profit forecasts from the U.S. technology sector. The bad news was led by perennial market favorite eBay Inc., which missed its earnings target for the fourth quarter and said its outlook for the current quarter was lower than expected, leading three brokerage firms to lower their ratings on the online auctioneer. Cell phone maker Qualcomm Inc. likewise issued a disappointing profit forecast.

EBay was down almost 19%, losing $19.37 to US$83.68. Qualcomm lost 7.94% or $3.26 to US37.81.

The pressure from tech shares took momentum from Citigroup’s strong earnings, and investors also shrugged off reports of a merger between Federated Department Stores Inc. and May Department Stores Co. Citigroup slipped 0.5% or 24¢ to US$47.80.

The talks between Federated and May, reported Thursday by The Wall Street Journal, signals another major consolidation in the retail sector, which is struggling to overcome the dominance of Wal-Mart Stores Inc. The proposed merger would combine Federated’s Macy’s and Bloomingdale’s stores with May’s Lord & Taylor, Filene’s and Marshall Field’s.

Federated slid $1.76 to $55.32 on the news, while May, which recently jettisoned Chief Executive 0fficer Gene Kahn, gained $3.20, or 10.2 percent, to $34.57.