Stocks trading in Toronto went for a steep drop in the first hour of trading, hurt by weaker commodity prices as doubts about Italy's ability to tackle its debt problems persisted even after Prime Minister Silvio Berlusconi pledged to resign.
The S&P/TSX composite index plummeted 165.83 points, or 1.3%, to 12,323.02
The Canadian dollar dumped 1.12 cents to 97.91 cents U.S.
Among Canadian stocks to watch in the early going, Enbridge Inc., which said its third-quarter profit fell on derivative losses. It earned $4 million, or one cent a share, down from $157 million, or 21 cents a share, a year ago.
Suncor Energy Inc. forecast a 12% rise in its oil sands production in 2012 and expects to spend about $3.6 billion toward growth projects in the coming year.
Silver Wheaton Corp. reported a 96% jump in third-quarter profit, driven by strong silver prices, and the company tripled its dividend for the current quarter.
First Quantum Minerals lowered its full-year production outlook to reflect a dip in quarterly production, even as higher gold and copper prices enabled the miner to post a third-quarter profit.
Patent licensing firm Wi-Lan Inc. swung to a third-quarter profit, as it signed more license agreements and saw a drop in litigation costs.
ATS Automation Tooling Systems Inc. said its second-quarter profit almost doubled, helped by acquisitions that boosted revenue at its transportation business.
TransGlobe Energy Corp.’s quarterly profit rose nearly three-fold, helped by higher production and strong Brent oil prices, but the Canadian oil and gas company cut its full-year production forecast.
Publishing whiz Quebecor Inc. said its third-quarter profit fell 69%, hurt mainly by a charge related to its move towards a new accounting method and higher costs.
Timmins Gold Corp. swung to a second-quarter profit as it sold more gold at higher prices.
Crocotta Energy Inc. achieved a third-quarter profit helped by rise in oil and natural gas production and said it expects to exit the year with higher production than expected.
On the economic front, Statistics Canada’s new housing price index crept up 0.2% in September, following a 0.1% improvement in August.
ON BAYSTREET
The TSX Venture Exchange dipped 27 points to 1,642.67, while the Nasdaq Canada index gave back 13.83 points to 415.84
Among the 14 Toronto subgroups, only gold saw daylight, gaining but 0.3%.
Among the losing groups, metals and mining tanked 5.1%, while global base metals fell 3.9% and energy got bruised 2.3%.
ON WALLSTREET
In New York, stocks opened with steep losses on Wednesday after a clearing house hiked the deposits needed to trade Italian government bonds and index-tied securities, further worsening Europe’s credit mess.
The Dow Jones Industrials hurtled earthward 272.42 points, or 2.2%, to 11,897.76, with all 30 of its components on the run.
The S&P 500 tripped 31.04 points to 1,244.61, while the Nasdaq Composite Index slid 70.05 points to 2,657.44.
Bank stocks were among the big losers, with Citigroup, Goldman Sachs and Morgan Stanley down more than 4%. JPMorgan Chase and Bank of America shares fell more than 3%.
Adobe shares tumbled after the company announced it is laying off 750 workers, or 7% of its workforce. Adobe also lowered its earnings forecast for the fourth quarter.
Shares of General Motors slid after the automaker posted lower third-quarter earnings of $1.7 billion U.S. CEO Dan Akerson said in the earnings release that the solid performance in the quarter "isn't good enough."
Shares of Macy's fell after the retailer reported earnings results ahead of the market open that missed expectations.
Dean Foods shares also slipped although the company posted a smaller-than-expected loss for the third quarter and raised its full-year outlook.
Cisco Systems is scheduled to report earnings after the market close.
Economically speaking, a report on inventories will be released later Wednesday.
Analysts surveyed by Briefing.com expect wholesale inventories to have increased by 0.5% for the month of September, after increasing 0.4% in the month prior.
Early Wednesday, Italy's 10-year bond yield spiked above 7% -- the level at which other European countries have had to seek bailout packages.
The surge came after London clearing house LCH Clearnet raised margins on the amount of collateral traders had to put up to hold Italian bonds.
Just a day earlier, Prime Minister Silvio Berlusconi agreed to resign after Parliament approves that country's budget, which could come as late as the first week of December.
While his pending resignation allows investors to scratch off one item on Europe's long list of worrisome questions, it also raises new questions about the country's future.
Many investors are realizing that this change in leadership isn't going to provide a quick fix to the nation's ongoing debt crisis, said Sebastian Galy, a senior currency strategist at Societe Generale.
Mounting fears about Italy also sparked a flight to quality in U.S. Treasuries. The 10-year yield fell to 1.98% from 2.06% late Tuesday, on galloping prices. Treasury prices and yields move in opposite directions.
Oil for October delivery gained $1.44 to $96.96 U.S. a barrel
Gold futures for December delivery fell $5.00 to $1,794.20 U.S. an ounce.
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