Stocks are lower today with geopolitical concerns seemingly dominating traders’ attention. At midday, the S&P/TSX composite index is down 60 points to 8,131.

Markets opened weak today on the news that the head of the Iraqi governing council was assassinated by a car bomb earlier today.

Today’s economic news was mostly ignored by the market. In Canada it was reported that the average price for a resale home in Canada rose to $246,305, which is up by almost 14% compared to year-ago prices.

In the U.S., the Empire State Manufacturing Survey for May was a bit weaker than expected, although most of the components showed improvement.

All of this has many traders sticking to the sidelines once again. Toronto volume is low at 101.2 million shares, with selling well ahead of buying by a margin of about 20:11. Market breadth is certainly weak, as losers outnumber winners by a margin of about seven to four.

On a sector basis, gold is up, as there’s a safe haven bid in those stocks, but everything else is down. Energy stocks are holding flat amid still rising prices. Techs are selling off sharply though, down more than 3%. There is also considerable weakness in consumer stocks, real estate, telecoms and financials.

Nortel is naturally leading the tech group down as the cloud around the firm and its accounting continues to grow. A criminal investigation is underway, and a report said that its executives took cash bonuses just before it restated earnings.

News of civil fraud charges against Lucent executives also appears to be dimming views on the tech firm. It is down almost 9% in heavy trading of 15.3 million shares.

However, there is strength in another troubled tech. Descartes Systems is seeing its debt rise 3.4% on news that it is cutting 35% of its staff and expects to record a restructuring charge of between $5.5-million and $6.5-million in its second fiscal quarter. The company expects to realize quarterly savings in expenses as a result of these initiatives of approximately $7.0-million.

Also in the group, there’s notable weakness in Zarlink Semi and Cedara Software. On the telecom side, takeover target Microcell is down a bit, as traders try to puzzle out its future. And, Sierra Wireless and SR Telecom are down sharply, as is Manitoba Telecom. BCE is off 0.5%.

Old economy stocks are being hit by geopolitical worries and rising oil prices. Alcan and Inco are both down 2.5%. And, there is selling in Inmet Mining, Niko Resources and Centurion Energy. Centurion reported earnings for first quarter 2004 were $2,023,000, compared with $4,085,000 for first quarter 2003.

Financials are getting hit on speculation that the government won’t be introducing bank merger guidelines on time, pushing possible deals off until 2005. Scotia is weakest, down 0.7%, but there is selling in TD Bank, CIBC, Royal Bank and Manulife Financial, too.

The General Donlee Income Fund is the big loser on the day, down more than 20% after it cut its distributions “for the foreseeable future.”

On the flip side, Air Canada has rallied 13% in heavy volume on news that it has reached a tentative agreement on cost realignment with the flight dispatchers, pilots and aerospace workers. Talks continue with Air Canada’s other unions. The agreement moves the airline closer to a bailout by Deutsche Bank.

The global turmoil is boosting golds, and select energy stocks too. Barrick is up 1.6%, Placer Dome has added 0.9%, and there is buying in Cambior, Meridian Gold, Bema Gold, Gabriel Resources and Golden Star Resources.

EnCana is flat at midday, leading the energy group. But, Talisman Energy has added 2.2%. On the flipside, Suncor is down 1.8%.

In earnings news, Northern Orion Resources had net earnings of $9,134,000 in its latest quarter, compared with a loss of $836,000 (for the same period in 2003.

Miramar Mining reported a consolidated net loss of $7.1-million, compared with a loss of $800,000 for the same period in 2003.

In New York, stocks are getting whipped around in the geopolitical crosswinds, too. At midday, the Dow Jones industrial average is down 105 points to 9,908, off its intra-day lows. The tech-heavy Nasdaq is down 18 ticks to 1,886.

The S&P/TSX Venture composite index is going its own way, gaining three points to sit at 1551. Volume is quite weak there too at 18.7 million shares. MD Multimedia Inc. is the day’s top trader, up just 0.5¢ to 10.5¢ on 528,000 shares.


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