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At midday: TSX edges up, BlackBerry slides again

FRANK GUNN/THE CANADIAN PRESS

The Toronto stock market was slightly higher Monday while BlackBerry (TSX:BB) stock continued to sell off amid collapsing sales and commodities failed to benefit from strong manufacturing data out of China.

The S&P/TSX composite index rose 6.56 points to 12,813.03.

BlackBerry shares were down 65 cents or 7.16 per cent to $8.43 after plunging more than 16 per cent Friday after the Waterloo, Ont.-based company warned of a huge second-quarter loss of almost $1-billion amid plunging sales of its new smartphones. It's also slashing about 4,500 jobs. BlackBerry releases its quarterly results Friday.

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Monday's further deterioration in BlackBerry's stock price came amid a number of downgrades, including RBC Dominion Securities, which cut the stock to "underperform" from "sector perform."

"There were hopes going in with this new product and clearly that's failed pretty badly," observed Jennifer Radman, portfolio manager at Caldwell Securities.

"It was a big pre-announcement and when you're looking at writeoffs and then revenue pretty much half of what people were expecting, it's pretty dire."

It was a much different story at Apple. Its stock rose 3.65 per cent to $484.45 (U.S.) after it said shoppers had snapped up nine million of the newest iPhones since the devices rolled out Friday.

The Canadian dollar was up 0.08 of a cent to 97.18 cents US.

Losses on American markets gained momentum after the president of the Atlanta Federal Reserve, Dennis Lockhard, said that data show the employment dynamics of the U.S. economy are slower, with fewer firms expanding employment and fewer people quitting work to find new opportunities.

The Dow Jones industrials were down 77.25 points to 15,373.84 while the Nasdaq declined 28.47 points to 3,746.26 and the S&P 500 index slipped 12.32 points to 1,697.59.

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Commodity prices were lower despite signs that the world's second biggest economy is gradually recovering from a prolonged slowdown.

The preliminary version of HSBC's purchasing managers' index for China climbed to a six month high of 51.2 from 50.1 in August on a 100-point scale. Numbers above 50 indicate an expansion in activity.

The gold sector was up one per cent while December bullion declined $4.10 to $1,328.40 an ounce. Barrick Gold Corp. (TSX:ABX) rose 36 cents to $19.47.

The base metals sector rose 0.7 per cent as December copper lost three cents to $3.29 a pound. First Quantum Minerals (TSX:FM) climbed 30 cents to $19.27.

The telecom sector rose 0.5 per cent on news that Telus (TSX:T), Bell Mobility (TSX:BCE), Rogers Communications (TSX:RCI.B) and Quebecor's Videotron (TSX:QBR.B) were among the prominent telecom companies that have put down a deposit to take part in Canada's wireless spectrum auction next January. Industry Canada says that a total of 15 participants have put down the deposit for the auction next Jan. 14. None of the 15 are foreign companies. Rogers led the pack, up 61 cents to $45.45.

November crude on the New York Mercantile Exchange dropped $1.36 to $103.39 (U.S.) a barrel. Prices fell almost four per cent last week amid dealmaking aimed at eliminating Syria's chemical weapons and the energy sector dipped 0.35 per cent. Cenovus Energy (TSX:CVE) fell 31 cents to $30.38.

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Investors are now turning their focus to the U.S., where the possibility of a government shutdown looms amid negotiations to raise the debt ceiling.

U.S. Federal Reserve chairman Ben Bernanke said last week that concerns over the latest fiscal showdown was a factor in the central bank's decision to maintain its asset purchase program. The Fed surprised markets by not announcing that it would start tapering its monthly $85-billion of bond purchases.

Elsewhere on the corporate front, Calgary-based fertilizer producer Agrium Inc. (TSX:AGU) says its third-quarter results will be negatively affected by soft prices and lower sales volumes in its wholesale operations. It says wholesale earnings before interest and tax will be about $200-million lower than in the same period last year.

Agrium also said it will increase its dividend by 50 per cent to $3 a share per year but its shares fell $3.27 to $90.23.

Overseas, London's FTSE 100 index declined 0.59 per cent, Frankfurt's DAX was down 0.54 per cent and the Paris CAC 40 dropped 0.82 per cent.

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