TSX Ends Lower On Continued Fed Concerns - Canadian Commentary
(RTTNews.com) - Canadian stocks ended lower for a second straight session on Thursday, as investors continued to worry over the upcoming U.S. Federal Reserve policy review meet after a bipartisan budget deal was reached in Washington earlier this week. The agreement lifted some of the fiscal uncertainty that the Fed has frequently cited as a hindrance to the economy.
The main index plummeted sharply yesterday with investors anxious over the outcome of the U.S. Federal Reserve policy meet, even as U.S. lawmakers reached a deal over its budget and averting a potential government shutdown next month.
Elsewhere, Asian stocks ended at a ten-week low, with Wall Street and European markets also ending in in negative territory after some mixed macroeconomic data out of the U.S. and Europe.
The S&P/TSX Composite Index closed Thursday at 13,114.39, down 19.03 points or 0.14 percent. The index scaled an intraday high of 13,143.80 and a low of 13,059.74.
Crude oil dropped settled marginally higher Thursday, as investors weighed demand growth prospects after a hefty drop in crude oil stockpiles in the U.S., even as gasoline inventories showed a sharp increase last week.
The Energy Index gained 0.23 percent, with U.S. crude oil futures for January delivery, the most actively traded contract, edging up $0.06 to close at $97.50 a barrel Thursday on the Nymex.
Among energy stocks, Canadian Natural Resources Limited (CNQ.TO) shed 0.06 percent and Suncor Energy Inc. (SU.TO) gained 1.38 percent. Talisman Energy Inc. (TLM.TO) gained 0.82 percent, while Encana Corp. (ECA.TO) edged up 0.05 percent.
Cenovus Energy (CVE.TO) dropped 1.09 percent after indicating a downsize to its investments by 13 percent to a range between C$2.8 billion and C$3.1 billion in 2014, when compared with the previous year.
Gas and electric distribution utility Fortis, Inc. (FTS.TO) lost 3.69 percent after indicating it would acquire UNS Energy Corp. (UNS) for an all cash offer of $4.3 billion or $60.25 per share.
Bellatrix Exploration (BXE.TO) gained 1.52 percent after confirming its 2014 guidance and completion of its mid-year review of its 2013 credit facilities.
The Information Technology Index slipped 0.46 percent, with smartphone maker BlackBerry Limited (BB.TO) ending flat at $6.29 a share.
The Diversified Metals & Mining Index shed 0.25 percent, with First Quantum Minerals Ltd. (FM.TO) gained 1.78 percent and Lundin Mining Corp. (LUN.TO) up 0.24 percent. Teck Resources Limited (TCK.B.TO) slipped 0.97percent, while Osisko Mining Corporation (OSK.TO) jumped 3.37 percent.
The Capped Materials Index slipped 0.14 percent, with Potash Corporation of Saskatchewan Inc.(POT.TO) down 0.68 percent.
Gold futures plunged to end lower for a second straight day on Thursday, over the prospect of a taper down by the U.S. Federal Reserve of its quantitative easing program after the policy review meet next week.
The Global Gold Index dropped 0.29 percent, with gold futures for February delivery, the most actively traded contract, plummeting $32.30 or 2.6 percent to close at $1,224.90 an ounce Thursday on the Nymex.
Among gold stocks, Kinross Gold Corp. (K.TO) added 0.41 percent, while Barrick Gold Corp. (ABX.TO) added 1.10 percent. Yamana Gold Inc. (YRI.TO) gained 0.87 percent, while IAMGOLD Corp. (IMG.TO) plunged 10.81 percent.
The Financial Index slipped 0.41 percent with Bank of Montreal (BMO.TO) down 0.23 percent, Royal Bank of Canada (RY.TO) down 0.48 percent, the Bank of Nova Scotia (BNS.TO) down 0.35 percent, and Toronto-Dominion Bank (TD.TO) down 0.39 percent.
The Capped Industrials Index gained 0.55 percent, with Bombardier Inc. (BBD.A.TO, BBD.B.TO) down 0.44 percent.
Meanwhile, Powersports vehicles maker BRP Inc. (DOO.TO) jumped 6.04 percent after reporting a normalized net income for the third-quarter of C$59.0 million or C$0.50 per share, up from C$42.4 million or C$0.42 per share last year.
Owner of beer brands like Laker and Red Baron, Brick Brewing Co. (BRB.TO) surged 9.17 percent after reporting a swing to profit in third quarter, with a net profit of $683.263 or $0.02 per share, compared with a loss of $416,252 or $0.01 per share a year earlier.
In economic news, Statistics Canada said the New Housing Price Index rose 0.1 percent in October, after remaining flat in September.
In economic news from the U.S., the Labor Department said initial jobless claims jumped by 68,000 to 368,000 in the week ended December 07 from the previous week's revised figure of 300,000. Economists had been expecting claims to climb to 325,000 from the 298,000 originally reported for the previous week. The Labor Department attributed the volatility seen over the past two weeks to the difficulty performing seasonal adjustments around holidays such as Thanksgiving.
Meanwhile, the US Commerce Department said retail sales rose by 0.7 percent in November following an upwardly revised increase of 0.6 percent in October. Economists had expected sales to increase by 0.6 percent compared to the 0.4 percent growth originally reported for the previous month. Excluding a 1.8 percent jump in auto sales, retail sales increased by a more modest 0.4 percent in November compared to the 0.5 percent growth in October.
Business inventories in the U.S. rose much more than expected in October, a Commerce Department report showed on Thursday. Business inventories rose by 0.7 percent in October following a 0.6 percent increase in September. Economists expected inventories to increase by a more modest 0.3 percent. Wholesale inventories jumped 1.4 percent, contributing to the stronger than expected growth along with a 0.8 percent increase in retail inventories. Inventories at manufacturers edged up just 0.1 percent.
Import prices in the U.S. fell for the second consecutive month in November, a report from the Labor Department showed Thursday, reflecting another sharp drop in prices for fuel imports. The import price index dropped 0.6 percent in November, matching the revised decrease reported for October. Economists expected import prices to fall by 0.8 percent.
Industrial production in the euro area decreased at a notably faster pace in October. Industrial production fell a seasonally adjusted 1.1 percent month-on-month in October, after dropping an upwardly revised 0.2 percent in the previous month, statistical office Eurostat said. Economists had forecast production to grow 0.3 percent, following September's originally reported 0.5 percent contraction.
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