TSX Ends Higher On Global Cues -- Canadian Commentary

(RTTNews) - Canadian stocks ended higher for a second straight session on Thursday, tracking rising global equity markets and on some upbeat domestic and U.S. trade data. The uptick was led by mining, financial, and telecom stocks, somewhat offset by losses in gold, healthcare, and information technology sectors.

Concerns over the slowdown in China took a back seat Thursday, with the Chinese stock market closed for a 2-day holiday.

Investors sentiments were on the up after Canada's trade deficit for July narrowed from a month ago. A report from Statistics Canada earlier today showed Canada's trade deficit in July to have narrowed to C$593 million from the revised C$811 million deficit in June. Economists expected a deficit of C$1.2 billion.

Canada's exports in July rose 2.3 percent, but export of energy products dropped 5.7 percent for the month.

Markets in Europe ended firmly in the green, after the European Central Bank left its interest rates unchanged. ECB President Mario Draghi's dovish comments at the press conference hinting that the central bank may consider further stimulus measures, also provided a shot in the arm for markets.

Markets in the United States also ended in positive territory, except with the Nasdaq trending lower just before close.

In some mixed economic news, the U.S. trade deficit narrowed more than expected in July, but weekly jobless claims increased more than anticipated. Investors now eagerly await the release of the employment report on Friday, which could give a strong indication of whether the Fed will decide to raise interest rates in September.

A report from the Institute for Supply Management on Thursday showed the pace of growth in the U.S. service sector to have modestly slowed, after reporting a substantial acceleration in the pace of growth in the previous month.

The benchmark S&P/TSX Composite Index closed Thursday at 13,596.41, up 51.16 points or 0.38 percent. The index scaled an intraday high of 13,706.76 and a low of 13,538.81.

On Wednesday, the index closed up 63.35 points or 0.47 percent, at 13,545.25. The index scaled an intraday high of 13,626.94 and a low of 13,419.99.

The Diversified Metals & Mining Index gained 1.64 percent, as First Quantum Minerals (FM.TO) jumped 3.44 percent, Teck Resources Limited (TCK-B.TO) added 2.27 percent, Lundin Mining Corp. (LUN.TO) added 0.73 percent, and HudBay Minerals Inc. (HBM.TO) surrendered 0.33 percent.

Sherritt International (S.TO) plummeted 5.36 percent.

The heavyweight Financial Index added 0.72 percent, as Bank of Montreal (BMO.TO) gained 0.81 percent and National Bank of Canada (NA.TO) gathered 1.71 percent. Royal Bank of Canada (RY.TO) gained 0.87 percent.

Toronto-Dominion Bank (TD.TO) gained 0.80 percent, Bank of Nova Scotia (BNS.TO) added 1.11 percent, and Canadian Imperial Bank of Commerce (CM.TO) moved up 0.41 percent.

Crude oil ended higher tracking rising global stock markets despite the dollar trending higher and the more than expected increase in the weekly crude stockpiles last week.

A weekly report from the U.S. Energy Information Administration yesterday showed crude stockpiles in the U.S. to have increased 4.7 million barrels in the week ended August 28, while analysts anticipated a decline of 0.8 million barrels.

The Energy Index edged down 0.02 percent, with U.S. crude oil futures for October delivery, the most actively traded contract, gaining $0.50 or 1.1 percent, to settle at $46.75 a barrel on the New York Mercantile Exchange Thursday.

Among energy stocks, Crescent Point Energy Corp. (CPG.TO) gained 1.92 percent, Canadian Natural Resources Limited (CNQ.TO) shed 1.25 percent, Cenovus Energy (CVE.TO) gathered 0.22 percent, and Encana Corp. (ECA.TO) moved up 1.43 percent.

Suncor Energy Inc. (SU.TO) dropped 0.14 percent.

Canadian Oil Sands (COS.TO) fell 4.72 percent. The company now estimates Syncrude production in 2015 to be near the low end of the 96 to 107 million barrel range provided on July 30, due to the process fire that occurred at Syncrude's Mildred Lake upgrader on August 29.

Gold futures ended lower as investors tracked the rising global stock markets, limiting the safe haven appeal of the precious metal with little support from a strengthening U.S. dollar.

The Gold Index declined 2.47 percent, with gold for December delivery dropping $9.10 or 0.8 percent, to settle at $1,124.50 an ounce on the New York Mercantile Exchange Thursday.

Yamana Gold Inc. (YRI.TO) dropped 1.32 percent, while IAMGOLD Corp. (IMG.TO) fell 2.44 percent.

Among other gold stocks, Barrick Gold Corp. (ABX.TO) dropped 3.94 percent, Kinross Gold Corp. (K.TO) fell 3.54 percent, Goldcorp Inc. (G.TO) fell 3.57 percent, and Eldorado Gold Corp. (ELD.TO) dropped 3.69 percent.

The Capped Materials Index dropped 0.77 percent, as Agnico Eagle Mines Limited (AEM.TO) fell 3.96 percent, Agrium Inc. (AGU.TO) inched up 0.10 percent, and Potash Corp. of Saskatchewan Inc. (POT.TO) added 0.71 percent.

The Capped Health Care Index fell 0.53 percent as Valeant Pharmaceuticals International (VRX.TO) slipped 2.33 percent after agreeing to acquire Synergetics USA, Inc. (SURG) for $6.50 per share in cash.

Among other healthcare stocks, Concordia Healthcare Corp. (CXR.TO) moved up 0.94 percent and Extendicare Inc. (EXE.TO) gained 1.09 percent.

The Capped Information Technology Index declined 0.88 percent, as BlackBerry Limited (BB.TO) fell 0.50 percent and Descartes Systems Group (DSG.TO) shed 0.39 percent and Avigilon Corp. (AVO.TO) plummeted 5.17 percent.

The Capped Telecommunication Index added 1.82 percent, as Rogers Communication (RCI-B.TO) gained 1.77 percent, BCE Inc. (BCE.TO) moved up 1.85 or 1.69 percent, TELUS Corp. (T.TO) moved up 1.77 percent, and Manitoba Telecom Services Inc. (MBT.TO) gathered 1.15 per share.

The Capped Industrials Index added 0.67 percent, as Bombardier (BBD.B.TO) jumped 3.45 percent, Finning International Inc. (FTT.TO) added 0.19 percent, Air Canada shed 0.45 percent, and AutoCanada (ACQ.TO) moved up 2.08 percent.

WestJet Airlines (WJA.TO) fell 0.34 percent, having reported a load factor of 84.6 percent for August. Revenue passenger miles increased 1.7 percent year over year, and available seat miles grew 7.3 percent.

On the economic front, a Labor Department report on Thursday showed first-time claims for U.S. unemployment benefits rose more than expected in the week ended August 29, a day ahead of tomorrow's monthly jobs data. Initial jobless claims climbed to 282,000, an increase of 12,000 from the previous week's revised level of 270,000. Economists expected jobless claims to edge up to 273,000 from the 271,000 originally reported for the previous week.

With the value of exports rising and the value of imports falling, a Commerce Department report on Thursday showed U.S. trade deficit to have narrowed notably in July. The trade deficit narrowed to $41.9 billion in July from a revised $45.2 billion in June. The deficit was the smallest since February. Economists expected the deficit to narrow to $42.0 billion from the $43.8 billion originally reported for the previous month.

After reporting a substantial acceleration in the pace of U.S. service sector growth in the previous month, a report from the Institute for Supply Management on Thursday showed a modest slowdown in the pace of growth in August. The ISM's non-manufacturing index edged down to 59.0 in August from 60.3 in July, although a reading above 50 indicates continued growth in the service sector. Economists expected the index to dip to 58.5.

Eurozone retail sales increased in July after falling a month ago, data from Eurostat showed Thursday. Retail sales advanced 0.4 percent in July from the prior month, reversing a revised 0.2 percent fall in June. This was the fastest growth in three months. Economists had forecast sales to grow at a faster pace of 0.5 percent. The figure for June was revised from a 0.6 percent fall initially estimated.

Eurozone private sector growth improved more than estimated in August, final data from Markit showed Thursday. The final composite output index rose to 54.3 in August from 53.9 in July. The flash reading for August was 54.1. Output growth accelerated moderately in both the manufacturing and service sectors.

Germany's private sector growth accelerated more than initially estimated to a 5-month high in August, final data from Markit showed Thursday. The composite output index rose to 55 in August from 53.7 in July. The flash reading for August was 54.0. The index signaled the strongest increase in private sector output since March.

The French private sector growth slowed more than estimated to a 7-month low in August, final data from Markit showed Thursday. The final composite output index fell to 50.2 in August from 51.5 in July. It was well below the flash score of 51.3.

French unemployment rate held steady in the three months ended June, in line with expectations, figures from the statistical office Insee showed Thursday. The jobless rate, measured according to International Labor Organization, or ILO, standards, came in at 10.3 percent in the second quarter, the same rate as in the previous month. The figure was also matched with consensus estimate.

British services sector expanded at its weakest rate in over two years casting doubt about sustainability of economic growth into third quarter, a closely watched survey revealed Thursday. The services Purchasing Managers' Index dropped to 55.6, which was the weakest score since May 2013, survey results from Markit Economics and the Chartered Institute of Procurement & Supply showed. That was in contrast to economists' expectation for a modest improvement in the reading to 57.7 from 57.4 in July. The growth slowed for second straight month.