Closing Bell TSX ends lower amid weak WalMart outlook disappointing European data

TORONTO — The Toronto stock market closed lower Thursday amid data showing the economic recovery in the European Union proceeding at a slower than expected pace and a disappointing outlook from retail giant and economic bellwether Wal-Mart stores.Here are the closing numbersTSX — 14,588.89-84.84 -0.58%S&P 500 —  1,870.85-17.68 -0.94%Dow — 16,446.81-167.16 -1.01%Nasdaq — 4,069.29-31.33-0.76%The S&P/TSX composite index dropped 84.84 points to 14,588.89.The Canadian dollar was up 0.05 of a cent at 91.94 cents US.U.S. indexes finished the session deep in the red as the Dow Jones industrials tumbled 167.16 points to 16,446.81, leaving the index in negative territory for the year to date. The Nasdaq dropped 31.34 points to 4,069.29 and the S&P 500 index fell 17.68 points to 1,870.85.Wal-Mart’s quarterly earnings came in at $3.59 billion, or $1.11 per share, down from $3.78 billion, or $1.14 per share a year ago as bad winter weather kept shoppers away. Its performance missed Wall Street’s view and, on top of that, the world’s biggest retailer gave a second-quarter earnings forecast below analysts’ estimates. Wal-Mart’s stock fell $1.91 or 2.43% to US$76.83.“Wal-Mart is a market mover,” observed Stephen Lingard, managing director, Franklin Templeton Solutions. “The miss and their weak outlook is going to hit a market that is looking for excuses maybe to take profits after a nice rebound.”Meanwhile, Eurostat, the EU’s statistics office, said the eurozone saw output grow by only 0.2% in the first quarter from the previous three-month period. Economists had expected a 0.4% increase.A large chunk of the blame for the underperformance can be placed on a flat performance in France, Europe’s second-largest economy behind Germany.The figures are likely to strengthen arguments for the European Central Bank to cut interest rates and take further stimulus measure at its next meeting June 5.“It certainly seems like there is more support for more unorthodox sort of monetary policy out of Europe,” added Lingard. “If anything, they should have been talking about this a year ago.”The gold sector was down about 1.75% as June bullion fell $12.30 to US$1,293.60 an ounce.July copper was down two cents at US$3.14 a pound and the base metals sector eased 1.06%.The energy sector fell 0.7% as June crude on the New York Mercantile Exchange fell 87 cents to US$101.50 a barrel. Bombardier (TSX:BBD.B) also weighed on the TSX after Air Canada decided not to immediately replace its remaining fleet of narrow-body Embraer E190s with the transport giant’s CSeries airliners. The carrier said that the 90-seat aircraft are still relatively young and it prefers to avoid more capital expenditures and debt as it focuses on adding 37 Boeing 787 Dreamliners and retrofitting 18 Boeing 777s with more seats. Bombardier shares fell 30 cents or 7.14% to $3.90 on very heavy volume of 42.6 million shares.Air Canada (TSX:AC.B) also posted an adjusted net loss of $132 million, or 46 cents per diluted share, compared with a net loss of $143 million, or 52 cents per share, year over year as it was impacted by a lower Canadian dollar. Its shares slipped 31 cents to $7.91.Elsewhere on the corporate front, Scotiabank (TSX:BNS) wants to sell some or all of its 37% stake in asset manager CI Financial Corp. (TSX:CIX). That position, acquired in 2008, is worth about $3.8 billion and the bank believes it can more profitably deploy the capital elsewhere. CI Financial shares fell $1.15 or 3.18% to C$34.98, while Scotiabank was up 56 cents to $67.53.TOP STORIESCanada’s three oil-rich provinces outperform 16 richest countries, economic report findsBehind Scotiabank’s plan to unload its $3.8-billion CI Financial stakeGM has now recalled 11.1-million vehicles this year — more than the past 6 years combinedAir Canada to keep 25 Embraer jets in blow to Bombardier CSeriesWHAT’S ON DECK FRIDAYCANADA8:30 a.m.International securities transactions (March): Economists expect $70-billion, up from last month UNITED STATES8:30 a.m.Housing starts (April): Economists expect 3.6% rise Building permits (April): Economists expect 1.3% rise 9:55 a.m.University of Michigan Consumer Sentiment Index (May): Economists expect a reading of 84.5, up slightly read more

Texas Energy Future Holdings files Chapter 11 reorganization plan to cut about

Texas’ Energy Future Holdings files Chapter 11 reorganization plan to cut about $40B in debt AddThis Sharing ButtonsShare to TwitterTwitterShare to FacebookFacebookShare to RedditRedditShare to 電子郵件Email Coal is transported up a conveyor belt into the TXU’s Big Brown coal-fired power plant in 2006 photo. THE CANADIAN PRESS/AP, David J. Phillip by Ramit Plushnick-Masti And Emily Schmall, The Associated Press Posted Apr 29, 2014 6:23 am MDT HOUSTON – Energy Future Holdings filed for Chapter 11 bankruptcy reorganization in a Delaware court on Tuesday, an expected move that will not harm power production or distribution in Texas as the company halves its $40 billion debt load.The company owns TXU Energy, which has the largest share of the Texas retail electricity market, and Luminant, the state’s largest power generator, but the bankruptcy is not likely to impact consumers in the short-term because distribution and production will continue.But the long-term impacts of restructuring remain unknown and could lead to the shutdown of some power plants, a large tax bill for the company or a leaner, more competitive market — a plus for consumers who could then enjoy lower electricity bills.The outcomes, though, will not be fully apparent until the restructuring is complete, which the company hopes to do within 11 months. Surprises, however, are unlikely because Energy Future has been talking to the largest stakeholders, including the IRS and environmental agencies, said James Hempstead, an analyst for Moody’s who has been following the company for more than 20 years.“It’s a little anti-climactic,” Hempstead said of Tuesday’s filing. “They’ve done a very good job in keeping everyone apprised as to what the situation is going to look like.”Still, a new owner could, for example, decide to either diminish the company’s reliance on coal as it becomes more costly to meet federal clean air regulations — such as a cross-state pollution ruling upheld Tuesday by the U.S. Supreme Court — or even shutter old facilities rather than invest in costly updates, Hempstead said. The impact of such decisions could be widespread because several Texas counties and school districts rely on the coal plants for taxes and jobs.Energy Future Holdings has insisted the coal plants will continue to operate, and Hempstead notes that for now, they are profitable.Energy Future’s troubles can be traced back to its bet that natural gas prices would rise, helping it repay the interest and loans it took to acquire TXU Energy in 2007. But a glut of U.S. shale production has instead brought natural gas prices to record lows, hurting the company’s bottom line and its ability to pay its debt. Recently, it skipped a deadline to pay $109 million in interest.As part of the bankruptcy, Energy Future’s subsidiary, Luminant Mining Co., will no longer be able to participate in the state’s self-bonding reclamation program. This program allows companies that have $10 million and other assets to avoid putting up cash in advance for required restoration of mined land.Now, Luminant has committed to set aside nearly $1.1 billion to restore land to its original condition.“The era of self-bonding by Luminant Mining appears to be over and rather than the taxpayers of Texas having to rely on a promise and a wink and a nod, there will actually be over $1 billion set aside in the Railroad Commission for restoration, so it’s a good first step,” said Al Armendariz, Sierra Club’s Beyond Coal senior campaign representative.Another crucial part of the restructuring is a $7 billion tax liability hanging over Energy Future’s head. When the company took over TXU Corp. in 2007, the new stakeholders were spared having to pay that federal tax bill on the acquisition. However, the terms of the deal stipulated that if the company split up, the massive tax bill would come due.Stakeholders hope they have reached a restructuring framework that will allow them to shed some of their assets without having to pay that tax, and have asked the IRS to rule on their request, said Allan Koenig, Energy Future’s spokesman.And because the company has been in constant dialogue with the IRS and others, Hempstead believes this is possible.“If they think that they’ve got a deal and a structure then it’s likely that they do,” he said.As part of the restructuring, Dallas-based Energy Future Holding said it will separate its Texas Competitive Electric Holdings Co. subsidiary, which includes TXU Energy, and give preferred lenders complete ownership in that reorganized business. It also will give lenders cash proceeds from new debt in exchange for eliminating about $23 billion of Texas Competitive Holdings’ funded debt.Energy Future will still own Energy Future Intermediate Holding Co. and keep its interest in Oncor Electric Delivery Co., a power transmission business, which is not part of the reorganization.The holding company was formed in the 2007 acquisition of TXU Corp. by private-equity firms KKR & Co., TPG Capital and Goldman Sachs Capital Partners.___Schmall reported from Fort Worth, Texas.__Plushnick-Masti can be followed on Twitter at https://twitter.com/RamitMastiAP read more