Crescent Point Energy said it would cut its capital spending for 2015 by 28 percent as oil continues its steep slide. Amber Kanwar has more.
The Toronto stock market was higher Friday as consumer stocks advanced in the wake of a strong retail report, and energy stocks climbed amid questions about whether the death of Saudi Arabia's King Abdullah could mean a change in the amount of oil his country is producing.
The S&P/TSX composite index ran ahead 55.88 points to 14,819.86 with the consumer staples section ahead 1.2 per cent as Statistics Canada reported retail sales rose 0.4 per cent to $43-billion in November. Economists had generally expected a decline.
In addition, Statistics Canada reported that a 16.6 per cent decline in prices at the pump from a year ago helped slow Canada's annual inflation rate last month to 1.5 per cent. The reading compared with an annual gain in the consumer price index of two per cent set in November. The December headline inflation reading matched economists' expectations, according to Thomson Reuters.
The core inflation measure, which excludes some volatile items such as gasoline, accelerated slightly in December to 2.2 per cent and matched expectations.
"We're all focused on the consumer, whether it's in the U.S. or Canada and to see the Canadian consumer stepping up and spending certainly has a beneficial impact," said Patrick Blais, managing director and portfolio manager Manulife Asset Management.
"Given the drop in oil prices, we`re all trying to assess if it will have an impact on confidence and therefore the Canadian consumer."
The Canadian dollar gained 0.02 of a cent to 80.64 cents US.
U.S. indexes were mainly lower with the Dow Jones industrials down 42.64 points to 17,771.34, the Nasdaq gained 11.84 points to 4,762.23 and the S&P 500 index declined 3.14 points to 2,060.01.
Oil prices rose slightly on news of the death of Saudi Arabia's monarch but by late morning had slipped a dime to US$46.21 a barrel.
Crude prices have plunged 40 per cent since the end of November when Saudi Arabia said it would seek to maintain market share by refusing to cut production in order to support prices. Overall, prices are down about 55 per cent from last June because of global oversupply.
There were questions about whether Abdullah's successor Prince Salman — 79-years-old and himself in poor health — will change the kingdom's oil policy. But Blais said the change at the top likely wouldn't matter.
"Saudi Arabia has definitely made their intentions clear and it's in their best interest long term to find a market level for the oil price," added Blais.
"There is so much over supply that we may be in for low oil prices for quite some time."
Meanwhile, the spinoff effects of plunging oil on smaller producers continued as Penn West Petroleum Ltd. CEO David Roberts said the company is in talks with bondholders about relaxing covenant agreements amd the collapse of oil prices threatens its ability to meet conditions on its debt. Its shares were unchanged at $1.96 but its stock has plunged 25 per cent in the past month.
The TSX energy sector was ahead 1.66 per cent.
A rising U.S. dollar helped push other commodities lower.
The gold sector lost 1.8 per cent while February bullion declined $10 to US$1,290.70 an ounce.
The base metals sector was the leading decliner, down 3.45 per cent while March copper shed seven cents to US$2.52 a pound. Copper, viewed as a global economic gauge, has tumbled more than 11 per cent this month amid weak China data and economic downgrades by the World Bank and the International Monetary Fund.
Meanwhile, General Electric Co. reported fourth-quarter earnings ex-items of 56 cents per share, a penny ahead of expectations. But the industrial conglomerate posted revenue of $42 billion, missing forecasts of $42.4 billion and its stock edged up 40 cents to $24.68.
In New York, UPS slumped 9.6 per cent as it said preliminary 2014 earnings were lower than previously forecast, after an over-expanded program to handle a deluge of holiday shipments left its network underutilized on some other days. Kimberly-Clark dropped 5.4 per cent after forecasting 2015 earnings that missed estimates. Starbucks Corp. jumped 6.1 pe rcent as new food and holiday drinks boosted customer traffic and sales.
The Stoxx Europe 600 Index rallied 1.6 per cent a day after the European Central Bank expanded its stimulus plan.
"The bigger picture is that we had a pretty sizable move in the market the day before," Kevin Caron, who helps oversee $170 billion at Stifel Nicolaus & Co. in Florham Park, New Jersey, said in a phone interview. "The market is still assessing the recent actions by the ECB, trying to figure out how much of that action was already priced into markets going into the meeting and what it might mean for markets going forward."
Purchases of previously owned U.S. homes rose less than forecast in December as higher prices limited sales to first- time buyers. The Markit Economics preliminary index of U.S. manufacturing cooled in January to a one-year low of 53.7 from a final reading of 53.9 a month earlier. A figure greater than 50 for the purchasing managers' measure indicates expansion.
With files from Bloomberg News