Canadian Stocks Are Down Slightly After Yesterday's Rally -- Canadian Commentary

(RTTNews) - The Canadian stock market is trading slightly to the downside early Friday, following the strong gains of the previous trading session. Weakness in commodity prices is partly responsible for the early losses. Investors are also playing it cautious ahead of a speech from Federal Reserve Chair Janet Yellen this afternoon.

Markets in Europe are turning in a mixed performance at the end of the trading week. Concerns over Greece continue to weigh on investor sentiment. At the end of talks in Riga, Latvia on Thursday, German Chancellor Angela Merkel said much more work needs to be done to provide bailout funds for Greece.

Markets in the United States are also under pressure in early trade Friday. The S&P 500 and the Dow Jones are trading in the red this morning, but the Nasdaq is modestly positive. Corporate results have been mixed at the end of the week, with better than expected results from Hewlett-Packard, but disappointing numbers from the Gap.

Federal Reserve Chair Janet Yellen is due to speak on the economic outlook before the Greater Providence Chamber of Commerce Economic Outlook at 1:00 pm ET.

Consumer prices in the U.S. rose in line with economist estimates in the month of April, according to a report released by the Labor Department on Friday, although the report also showed a bigger than expected increase in core prices.

The Labor Department said its consumer price index inched up by 0.1 percent in April after rising by 0.2 percent in each of the two previous months. The modest increase matched economist estimates.

The benchmark S&P/TSX Composite Index is down 21.54 points or 0.14 percent at 15,182.07.

On Thursday, the index closed up 130.78 points or 0.87 percent, at 15,203.61. The index scaled an intraday high of 15,230.72 and a low of 15,092.25.

The Energy Index is decreasing by 0.58 percent. Crude oil prices held above $60 a barrel Friday morning amid tensions in the Middle East and speculation that Federal Reserve will delay raising interest rates.

Encana (ECA.TO) is declining by 0.30 percent and Crescent Point Energy (CPG.TO) is lower by 1.87 percent. Canadian Oil Sands (COS.TO) is losing 1.78 percent and Canadian Natural Resources (CNQ.TO) is falling by 0.72 percent.

Legacy Oil + Gas (LEG.TO) is dipping by 0.33 percent and Suncor Energy (SU.TO) is decreasing 0.60 percent. Pacific Rubiales Energy (PRE.TO) is dropping by 1.59 percent.

The heavyweight Financial Index is lower by 0.38 percent. Bank of Montreal (BMO.TO) is declining by 0.41 percent and Canadian Imperial Bank of Commerce (CM.TO) is lower by 0.66 percent. Royal Bank of Canada (RY.TO) losing 0.46 percent and National Bank of Canada (NA.TO) is decreasing by 0.76 percent. Bank of Nova Scotia (BNS.TO) is also down 0.58 percent.

The Capped Industrials Index is lower by 0.15 percent. Canadian National Railway (CNR.TO) is down 0.12 percent and Canadian Pacific Railway (CP.TO) is losing 0.33 percent. Air Canada (AC.TO) is falling by 0.87 percent and Bombardier (BBD-A.TO) is declining by 1.17 percent.

The Capped Health Care Index is up 0.95 percent. Valeant Pharmaceuticals International (VRX.TO) is climbing by 2.43 percent and Catamaran (CCT.TO) is gaining 0.64 percent.

The Capped Information Technology Index is advancing by 0.52 percent. Sierra Wireless (SW.TO) is up 0.62 percent and BlackBerry (BB.TO) is gaining 2.55 percent.

The Gold Index is rising by 0.81 percent. Gold prices are slightly lower after the increase in U.S. inflation matched expectations.

B2Gold (BTO.TO) is climbing by 0.47 percent and Goldcorp (G.TO) is advancing by 1.02 percent. Eldorado Gold (ELD.TO) is gaining 1.18 percent and IAMGOLD (IMG.TO) is up 1.14 percent.

The Capped Materials Index is also up 0.24 percent. Agnico Eagle Mines (AEM.TO) is rising by 0.43 percent and Franco-Nevada (FNV.TO) is gaining 1.27 percent. Agrium is also higher by 0.18 percent.

The Diversified Metal and Mining Index is climbing by 0.18 percent. Lundin Mining (LUN.TO) is gaining 0.52 percent and HudBay Mineral (HBM.TO) is higher by 0.53 percent. First Quantum Minerals (FM.TO) is also up 0.92 percent.

On the economic front, Canadian consumer price index rose by 0.8 percent in April, according to a report from Statistics Canada this morning. Economists had expected an increase of 1.0 percent.

Statistics Canada also reported this morning that Canadian retail sales increased by 0.7 percent in March. Economists had been expecting retail sales to rise by 0.3 percent.

German business confidence weakened marginally from a 10-month high in May and the economy grew at a slower pace in the first quarter, as initially estimated, revealed two separate reports released Friday.

The business confidence index fell less-than-expected to 108.5 in May from 108.6 in April, according to a survey by Munich-based Ifo Institute. This was the first fall in seven months but the index came in above the economists' estimate of 108.3.

Germany's economic growth eased as estimated in the first quarter largely due to the weakness in foreign trade, final data from Destatis showed Friday. Gross domestic product grew 0.3 percent sequentially in the first quarter, slower than the 0.7 percent expansion seen in the fourth quarter.

The total value of new orders received by the German construction industry declined in March, figures from Destatis showed Friday. Orders in the construction sector fell a seasonally and working-day-adjusted 2.2 percent month-over-month in March.

French consumer confidence improved unexpectedly in May to the strongest level since August 2011, survey data from the statistical office Insee showed Friday. The manufacturing confidence index rose slightly to 103 in May from 102 in the previous month, which was revised from a reading of 101. Economists had expected the index to remain stable at 101.

The U.K. budget deficit narrowed in April from last year, data published by the Office for National Statistics showed Friday. Public sector net borrowing excluding banks declined by GBP 2.5 billion to GBP 6.8 billion in April.

British households perceive that the value of their home increased in May, a survey from Knight Frank and Markit Economics showed Friday. The house price sentiment index, or HPSI, fell slightly to 58.0 in May from 58.2 in the previous month. However, a reading above 50 indicates a rise in house prices. This marked the twenty-sixth successive month of the index remaining above 50.

In commodities, crude oil futures for June delivery are down $0.71 or 1.17 percent at $60.01 a barrel.

Natural gas for June is down $0.034 or 1.15 percent at $2.915 per million btu.

Gold futures for June are down $0.60 or 0.05 percent at $1,203.50 an ounce.

Silver for July is down $0.062 or 0.36 percent at $17.07 an ounce.