The Toronto stock market was off to a tepid start to September trading Tuesday as investors wondered what steps central banks might take to support the economic recovery amid another dose of weak U.S. economic data.
The S&P/TSX composite index slipped 7.56 points to 11,941.70 while the TSX Venture Exchange rose 1.84 points to 1,242.58.
The Canadian dollar also finished little changed, down US0.01¢ at US101.44¢. The loonie could be in for some volatility after Quebecers vote in a new government Tuesday while the Bank of Canada makes its next announcement on interest rates Wednesday.
U.S. markets were mainly lower even as a disappointing reading of a key gauge of the manufacturing sector and lower construction spending raised expectations that the U.S. Federal Reserve will embark on another jolt of stimulus.
The Dow Jones industrial average fell 54.90 points to 13,035.94 after the Institute for Supply Management's August index came in at 49.6, a bit weaker than July's reading of 49.8 and below expectations of 50.2, which would have signalled expansion.
Also, construction spending dropped by 0.9% in July against expectations for a slight increase.
The Nasdaq composite index was ahead 8.10 points at 3,075.06 and the S&P 500 index was off 1.64 points to 1,404.94.
Investors also looked to employment data for clues as to whether the Fed thinks the U.S. economic recovery needs help in staying on the rails.
Economists expect Friday's non-farm payrolls report to show that the U.S. economy created 127,000 jobs in August, on top of 163,000 in July. The Fed holds its next meeting Sept. 13.
Canadian employment data are also being released Friday. It is believed that the economy cranked out 11,000 jobs last month.
Traders also looked ahead to Thursday and an announcement from European Central Bank president Mario Draghi. He is expected to announce details of a new bond-buying program intended to bring down the borrowing costs of countries such as Spain and Italy.
The plan is seen as a crucial step toward easing the European government debt crisis, which is increasingly hurting the continent's economy.
Ahead of Thursday's announcement, Moody's Investors Service lowered its rating outlook for the 17-country region that uses the euro currency, as uncertainty over the European debt crisis grows and the stronger countries in the group could be hard-pressed to provide support.
