Markets are taking another hit Tuesday, due to a combination of negative corporate and economic news. At midday, the S&P/TSX index is down 105 points to 6,314.

Volume is strong at 109.3 million shares, with the selling outweighing the buying by almost five to two. Market breadth is also bearish, with losers outnumbering winners by a margin of three to two.

The gold group is the only one seeing any buying today, as traders take refuge there. The financials are leading the way down, dropping about 2.5%, as the bank-merger froth comes back out of the market.

The weakness elsewhere comes after a terrible consumer confidence report in the U.S. and talk of a rate cut there to stave off another recession. Techs are leading the way, dropping 6%. There is also notable selling in core areas such as consumer stocks, diversifieds and industrials.

The banks are the big losers today, as any hope that they had for possible mergers has been squelched by reports that the government won’t consider mergers until it has a new prime minister. Bank of Montreal, which was reportedly in talks with Scotia, is down 3% on the news. CIBC is down 3.8%, TD Bank is off 3%, and Royal Bank is down 1.4%.

Nortel Networks is driving the tech trade once again today. It is down 13% on 33.8 million shares. Celestica is down 6%, and there is selling in Ballard Power, QLT, Telus and Rogers Communications.

Other losers include EnCana, Bombardier, Hudson’s Bay, and Enerchem International.

The golds are the only real source of strength, driven by a 3.5% gain in Placer Dome. There is also buying in Kinross, Bema Gold, TVX Gold and Agnico Eagle. Barrick is bucking the trend, dropping 0.8% on the day.

Non-gold gainers include Compton Petroleum, Canadian Utilities and Quebecor World.

In earnings news, Bowater reported a net loss of $32.3 million. These results compare with a net loss of $1.8 million in the third quarter of 2001. Included in the 2002 net loss is a $3 million gain related to asset sales and a foreign exchange gain of $10.1 million. Before these two items, the net loss for the third quarter of 2002 was $45.4 million.

Also, Cardiome Pharma recorded a net loss of $3,096,792, as compared with a net loss of $1,703,319 for the same period in the preceding fiscal year.

Finally, Mitec Telecom has named Rajiv Pancholy as the company’s new president and chief executive officer. Pancholy replaces Myer Bentob, who stepped down from the post on September 12.

In New York, the market opened the day slightly on the downside, but the brutal consumer confidence numbers pushed markets much lower. At midday, the Dow Jones industrial average is down 132 points to 8,236. The S&P 500 has dropped 19 points to 871. The Nasdaq composite is down 33 points to 1,283.

Small caps are bucking the down trend. The S&P/TSX Venture index is up three points to 904. Volume is very heavy at 22.7 million shares. Roseland Resources is the story of the day, flat at 13¢, with an incredible 7.6 million shares changing hands. Much of the trade comes through Quest Investment acquiring 7.2 million of its shares.