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TORONTO — The Toronto stock market may be in for improved performance following a lacklustre 2012 if the U.S. and Chinese economies revive next year and boost prices for commodities and resource stocks.But much depends on whether Republicans and Democrats in Washington, D.C., can find a compromise to avoid steep tax increases and significant spending cuts that are set to kick in automatically early in 2013.Analysts have warned that the shock of going over the so-called fiscal cliff would halt already tepid global economic growth in its tracks and likely push the U.S. back into recession.There is no in-between on this. It’s either going to be bad or it’s going to be great for the market“This is very much a binary event that we’re watching unfold,” said Andrew Pyle, investment adviser with ScotiaMcLeod in Peterborough, Ont.“There is no in-between on this. It’s either going to be bad or it’s going to be great for the market.”The TSX is set to finish 2012 trading with a slight gain of about 3.5% following an 11% slide in 2011.Losses on the resource-heavy Toronto market were highlighted by weakness in the base metals sector, which slid nearly 10% — primarily because of lower demand from China as the government slowed economic growth to bring inflation down from unacceptably high levels.Similarly, the energy sector sustained a drop of about 8% as slowing economic conditions left the world awash in crude oil.Gold stocks were also a significant drag for the Canadian stock markets as miners contended with higher costs for extracting the previous metal. The TSX’s global gold index fell about 19%.The financial sector, another major pillar of the TSX, has fared better. It ends 2012 about 13% higher after the six biggest banks posted record profits — roughly US$30-billion for 2012 on about US$107-billion in revenue, compared with US$25-billion on US$98-billion in revenue in 2011.But analysts warn that growth in Canadian retail banking, a key strength for the sector over the past several years, will likely slow in 2013 amid record consumer debt levels and a cooling housing market.At the same time, market watchers are confident that U.S. lawmakers will arrive at a framework for avoiding the fiscal crisis by the beginning of 2013 deadline although a comprehensive deal on taxes and spending cuts will likely take longer.“We’re of the view that there will be some kind of an agreement and at the end of the day, there will be some tax increases and some spending cuts,” said Robert Gorman, chief portfolio strategist at TD Waterhouse.“So you will end up with fiscal drag, which will to some degree likely reduce growth modestly but won’t go over the proverbial cliff.”The eurozone will continue to weigh on global markets. The region’s debt crisis has resulted in recessions for several countries that use the euro as governments in Spain, Greece, Italy and Portugal deliver tough austerity measures.“For anyone out there that’s expecting a big turnaround in the eurozone or anything in Europe in 2013, they probably will be disappointed,” said Craig Fehr, Canadian markets specialist at Edward Jones in St. Louis.“I think it’s going to be a lot more of the same as it relates to Europe and that means slow to no to maybe negative economic growth in the eurozone in 2013.”Even so, there are some real positives for the TSX this year.The drag on the U.S. economy created by whatever agreement lawmakers come to will be offset in part by the housing sector, which is expected to finally start making a contribution to economic growth.“That’s one of the key points,” said Gorman.He pointed to a huge drop in housing inventories, which are now down to 6.1 months from a high of 12 months at the worst of the downturn.He also noted that prices are still off around 30% from the peak reached in 2006 and financing is still ultra-low with a 30-year mortgage going for around 3.5%. Inventories are down quite sharply.AFP/Getty Images “Historically in the U.S. if you look at the history of coming out of recession, housing has historically contributed fully 13% of all US GDP growth,” said Gorman.“In this cycle, there has been no such contribution and 2013 will be the first of any significance.”Gorman also said the U.S. economy will benefit from a strengthening auto sector.China is also expected to be a plus for the TSX resource sector as economic growth in the world’s second-biggest economy finally started to pick up towards the end of 2012.Key manufacturing indexes finally moved into expansion territory and there was also positive factory output, retail sales and electricity consumption figures.“All of these things suggest economic growth could start moving higher as opposed to continuing to slide lower in China, that bodes quite well for the Canadian economy,” Fehr says.“It also bodes well for commodity prices and the resource sector.”After balancing the good and bad expected for 2013, performance on the TSX will be anything but red-hot.“It will be an OK year,” Gorman says.“In Toronto, I think we will probably do 5% plus dividends — so 5%, maybe a touch better.”The Canadian Press read more

Joe Skipper / Reuters An aerial view shows debris after Hurricane Dorian hit the Grand Bahama Island in the Bahamas, on Wednesday, Sept. 4, 2019. After inflicting ‘extreme damage’ on Bahamas, Dorian on path to Florida Hurricane Dorian could cost insurers $25 bln: UBS DARTH DORIAN? Hurricane nixes some ‘Star Wars’ fans’ dream trips An aerial view shows a flooded area after Hurricane Dorian hit the Grand Bahama Island in the Bahamas, on Wednesday, Sept. 4, 2019. LaQuez Williams, pastor at Jubilee Cathedral in Grand Bahama, who opened the church as a shelter for about 150 people, said he saw people on their rooftops seeking refuge.“They were calling for help, but you could not go out to reach,” Williams said. “It was very difficult because you felt helpless.”A Reuters photographer surveying the damage on Grand Bahama island said many hangers at Freeport airport and several aircraft appeared to be severely damaged.Dorian killed one person in Puerto Rico before hovering over the Bahamas for two days with torrential rains and fierce winds that whipped up 12-18 foot (3.7- to 5.5-meter) storm surges in places.At 11 p.m. EST on Wednesday, Dorian was about 105 miles (170 km) south of Charleston, South Carolina, the NHC said.It had strengthened to regain its status as a Category 3 storm late on Wednesday, after passing over warm waters which are a key ingredient in hurricane intensity, the NHC said.The NHC issued a storm surge warning that covered the whole length of the coasts of Georgia, South Carolina and North Carolina and extending to Hampton Roads in southern Virginia.More than 2.2 million people in Florida, Georgia, North Carolina and South Carolina have been ordered to evacuate.Florida avoided a direct hit from Dorian.With many telephones down on Abaco and Grand Bahama islands, residents posted lists of missing loved ones on social media sites.A single Facebook post by media outlet Our News Bahamas seeking the names of missing people had 2,000 comments listing lost family members since it went live on Tuesday, although some of the comments were also about loved ones being found.An international relief effort was under way, with a British Royal Navy vessel providing assistance and Jamaica sending a 150-member military contingent to help secure Abaco and Grand Bahama, officials said.Volunteers also ferried supplies to the islands in a flotilla of small boats.“Let us give of our best in this moment of historic tragedy,” Minnis said. NASSAU — Survivors of Hurricane Dorian in the Bahamas thronged rescue helicopters on Wednesday and the United Nations said 70,000 people needed immediate humanitarian relief after one of the most powerful Caribbean storms on record devastated the island group.The most damaging storm to strike the island nation, Dorian killed 20 people when it hit as a highest-level Category 5 storm, Bahamas Prime Minister Hubert Minnis said.“We expect that this number will increase,” Minnis told a news conference as the scope of the destruction and humanitarian crisis was still coming into focus.Aerial video of the worst-hit Abaco Islands in the northern Bahamas showed widespread devastation, with the harbor, shops and workplaces, a hospital, and airport landing strips damaged or blown to pieces, all of which is frustrating rescue efforts.Mark Lowcock, United Nations under secretary-general for humanitarian affairs, said in a conference call from the Bahamas that around 70,000 people needed food, shelter and medical assistance.“There is concern that some whole communities’ locations have been destroyed or are underwater or washed away,” he said. “One of the uncertainties is where the people who were living there are now and how to reach them.” An airplane is pictured near the airport after Hurricane Dorian hit the Grand Bahama Island in the Bahamas, on Wednesday, Sept. 4, 2019. ADAM DELGIUDICE / AFP/Getty Images Joe Skipper / Reuters He also encouraged international tourists to visit the Bahamas, which relies heavily on its hospitality industry.As many as 13,000 homes in the Bahamas may have been destroyed or severely damaged, the International Federation of Red Cross and Red Crescent Societies said.The State Department said it did not believe any U.S. citizens who were in the Bahamas, a popular tourist destination, during the storm were killed.President Donald Trump said the United States was sending supplies to the islands, including materials that had been originally intended for any Dorian victims in Florida. In the United States, South Carolina was preparing for a record storm surge, potentially reaching a height of 8 feet (2 metres) at the popular vacation destination of Myrtle Beach, the U.S. National Hurricane Center (NHC) said in an advisory.South Carolina is also likely to suffer major flooding with the potential for over a foot of rain in places when Dorian hits the coast on Thursday or Friday, the center said.Dozens of people in the Bahamas, with a population of about 400,000, took to Facebook seeking information about missing loved ones. One aid worker described an apocalyptic level of destruction on Great Abaco Island.“There is no coordination, no communication, and things are going to get worse if that continues,” said medic Tricia Wesolek, 46. Strong gusts of wind and bands of heavy rain cover a walkway at the Jensen Beach Causeway Park in Jensen Beach, Florida on Tuesday, Sept. 3, 2019. Joe Skipper / Reuters read more