Canadian Stocks Are Under Pressure As Crude Prices Fall -- Canadian Commentary

(RTTNews) - The Canadian stock market is trading firmly in the red Friday morning, giving back some of yesterday's strong gains. Weakness in crude oil prices is driving the energy sector lower in early trade, as prices have dropped below $43 a barrel. Financial stocks are also under pressure due to concerns over Deutsche Bank in Europe.

Markets in Europe are trading firmly in negative territory Friday. Banks across Europe are sinking on concerns about Deutsche Bank's fragile finances. The German lender said it has no intent to pay the $14 billion sought by the U.S. Department of Justice to settle civil claims over the bank's sale of residential mortgage-backed securities related to the 2008 financial crisis. The lender said it has "no intent to settle these potential civil claims anywhere near the number cited."

Markets in the United States are also slipping in early trade Friday. Profit taking appears to be playing a role in the pullback, as some traders look to cash in on the substantial gains posted in the previous session. Concerns about the outlook for interest rates eased slightly after consumer prices rose by slightly more than expected in August.

The benchmark S&P/TSX Composite Index is down 67 points or 0.46 percent at 14,436.67.

On Thursday, the index closed up 137.21 points or 0.96 percent, at 14,503.67. The index scaled an intraday high of 14,529.79 and a low of 14,382.87.

The Capped Healthcare Index is lower by 1.57 percent. Extendicare (EXE.TO) is down 1.34 percent and Valeant Pharmaceuticals Internationals (VRX.TO) is falling 1 percent.

Concordia Healthcare (CXR.TO) is sinking 21.26 percent. The stock is under pressure after the U.K. proposed a bill which would amend and extend existing provisions of the National Health Service Act 2006.

The Energy Index is down 1.02 percent. Crude oil prices have tumbled below $43 a barrel Friday morning, extending this week's losses.

Crescent Point Energy (CPG.TO) is weakening by 3.91 percent and Encana (ECA.TO) is declining 1.32 percent. Suncor Energy (SU.TO) is decreasing 0.67 percent and Imperial Oil (IMO.TO) is slipping 0.41 percent. Canadian Natural Resources (CNQ.TO) is down 0.65 percent and Cenovus Energy (CVE.TO) is losing 1.17 percent. Husky Energy (HSE.TO) is falling 1.54 percent.

The Capped Information Technology Index is falling 0.83 percent. Constellation Software (CSU.TO) is down 1.96 percent and Sierra Wireless (SW.TO) is declining 0.82 percent. Descartes Systems Group (DSG.TO) is losing 0.33 percent and BlackBerry (BB.TO) is surrendering 0.21 percent.

The heavyweight Financial Index is decreasing 0.74 percent. Royal Bank of Canada (RY.TO) is down 1.02 percent and Bank of Nova Scotia (BNS.TO) is falling 0.61 percent. Bank of Montreal (BMO.TO) is lower by 0.88 percent and National Bank of Canada (NA.TO) is weakening by 0.76 percent. Canadian Imperial Bank of Commerce (CM.TO) is losing 0.34 percent and Toronto Dominion Bank (TD.TO) is forfeiting 0.56 percent.

The Capped Telecommunication Services Index is down 0.80 percent. TELUS (T.TO) is losing 0.31 percent and Manitoba Telecom Services (MBT.TO) is slipping 0.50 percent. BCE (BCE.TO) is falling 0.89 percent and Rogers Communication (RCI-B.TO) is lower by 1.36 percent.

The Capped Industrials Index is losing 0.43 percent. Canadian National Railway (CNR.TO) is decreasing 0.23 percent and Canadian Pacific Railway (CP.TO) is weakening by 0.76 percent. Air Canada (AC.TO) is declining 0.71 percent and AutoCanada (ACQ.TO) is dipping 0.28 percent. Bombardier (BBD-B.TO) is also dropping 1.06 percent.

The Gold Index is lower by 0.11 percent. Gold prices are lower Friday morning even as inflation data kept alive expectations of a US interest rate hike into 2016.

Goldcorp (G.TO) is lower by 0.67 percent

The Capped Materials Index is up 0.14 percent. Agnico Eagle Mines (AEM.TO) is gaining 0.26 percent and Silver Wheaton (SLW.TO) is advancing 0.14 percent. Agrium (AGU.TO) is climbing 0.51 percent and Potash Corp. of Saskatchewan (POT.TO) is up 0.64 percent.

On the economic front, Statistics Canada reported this morning that Canadian manufacturing sales increased by 0.1 percent in July. Economists had been expecting an increase of 1.0 percent.

Eurozone hourly labor cost grew at a slower pace in the second quarter, Eurostat reported Friday. Hourly labor costs increased 1 percent year-on-year, slower than the 1.6 percent growth registered a quarter ago.

Consumer prices in the U.S. increased by slightly more than expected in the month of August, according to a report released by the Labor Department on Friday. The Labor Department said its consumer price index rose by 0.2 percent in August after coming in unchanged in July. Economists had expected prices to inch up by 0.1 percent.

With an improvement in consumer expectations offset by a deterioration in views of current economic conditions, the University of Michigan released a report on Friday showing that U.S. consumer sentiment has been unexpectedly flat in September.

The University of Michigan said the preliminary reading on its consumer sentiment index for September came in at 89.8, unchanged from the final August reading. Economists had expected the index to inch up to 90.8.

In commodities, crude oil futures for October delivery are down 1.04 or 2.37 percent at $42.87 a barrel.

Natural gas for October is down 0.027 or 0.92 percent at $2.90 per million btu.

Gold futures for December are down $6.60 or 0.50 percent at $1,311.40 an ounce.

Silver for December is down $0.246 or 1.29 percent at $18.795 an ounce.