The S&P/TSX composite index fell 78.69 points to 10,124.89.
The capped energy subindex fell almost 3 per cent. Suncor Energy Inc. fell $2.67 to $59.37. EnCana Corp. fell $2.52 to $49.08. And Petro-Canada fell $1.82 to $81.98.
Oil prices fell sharply amid forecasts that an approaching hurricane would miss key energy producing regions in the Gulf of Mexico. Crude for August delivery dropped $2.21 (U.S.) to settle at $57.80 a barrel on the New York Mercantile Exchange.
U.S. consumer prices were unchanged in June from a month earlier, confounding expectations of an increase — a sign that inflation in the world's largest economy remains tame. As well, retail sales rose, confirming the impression of a robust economy.
In Canada, frozen treats maker CoolBrands International Inc. plunged $1.29 or 33.6 per cent to $2.55. The company reported a third-quarter loss of $6.9-million (U.S.) after losing a lucrative contract with Weight Watchers.
Nexen Inc., which will sell almost $1-billion of Canadian oil and gas assets this summer, said second-quarter profit jumped almost 40 per cent on higher fuel production and prices. Profit for the second quarter rose 39.9 per cent to $200-million from $143-million. Nexen shares reversed early gains as crude oil fell. The stock slid $1.15 or 2.7 per cent to $41.01 (Canadian).
The Canadian dollar closed at 82.49 (U.S.) on Thursday, down 0.33 of a cent from Wednesday.
In the U.S., Apple Computer Inc.'s earnings boosted the overall tech sector as the computer and electronics maker credited ongoing demand for the iPod music player for its record profits. While Apple took the unusual step of warning that its third-quarter profits would fall below expectations, investors weren't dissuaded. Apple stock surged 6.3 per cent, or $2.40 (U.S.), to $40.75.
Advanced Micro Devices Inc. rose 63 cents to $19.88 after the chip maker reported a 65 per cent drop in profits, yet still beat Wall Street profit forecasts by 8 cents per share. While analysts expected the company to post a loss for the quarter, record microprocessor sales helped the company overcome a sharp drop in demand for flash memory chips.
In a rare bit of good news for the airline sector, Southwest Airlines Inc. saw a 41 per cent surge in profits for the second quarter. The company credited fare increases and rising passenger traffic for helping overcome rising fuel prices, though the company added that its hedges against rising jet fuel remained strong. Southwest climbed 44 cents to $14.42.
Yum Brands Inc., parent company of the Taco Bell and KFC fast food chains, dropped $1.86 or 3.6 per cent to $49.85 despite reporting a rise in second-quarter profits that beat Wall Street expectations by 5 cents per share. Strong U.S. sales bolstered by new menu offerings at KFC were credited for the performance, but the company issued lower forecasts for its third and fourth quarters.
The generally positive earnings caused investors to look forward optimistically to General Electric Co.'s results, due before Friday's session. GE added 45 cents to $35.63 in anticipation of an upbeat report.
