TSX Ends Lower After Jobs Data -- Canadian Commentary

(RTTNews) - Canadian stocks ended lower for a second straight session on Friday, as energy stocks tracked oil prices lower, despite some better than expected jobs report from Canada. Weakness in Europe and U.S. markets also weighed on investor sentiment, following the release of the U.S. employment report for July.

Data from Statistics Canada showed Canada to have added 6,600 jobs in July. Economists had expected an increase of 5,000 jobs. The unemployment rate held steady at 6.8 percent, which was in line with expectations.

The majority of the European markets ended lower, with disappointing economic data from the Eurozone on Friday. Germany's industrial production logged an unexpected decline in June, while German exports decreased for the first time in five months. French industrial output also declined unexpectedly in June.

Markets in the United States also ended in the red after the jobs data. The highly anticipated U.S. employment report showed that the pace of job growth slowed for the second consecutive month in July. The next monthly jobs report may be even more closely watched, as it will be released less than two weeks before the Fed's September meeting.

The unemployment rate in the U.S. remained unchanged at 5.3 percent.

The benchmark S&P/TSX Composite Index closed Friday at 14,302.70, down 103.21 points or 0.72 percent. The index scaled an intraday high of 14,458.11 and a low of 14,265.03.

On Thursday, the index closed down 97.08 points or 0.67 percent, at 14,405.91. The index scaled an intraday high of 14,499.43 and a low of 14,378.62.

Gold futures ended higher as the dollar weakened after some soft U.S. jobs data, with growth in July coming in below expectations. However, analysts see no possible change in the Fed stand in hiking interest rates soon, which is likely come September.

The Gold Index added 0.33 percent, with gold for August delivery gaining $4.00 or 0.4 percent, to settle at $1,094.10 an ounce on the New York Mercantile Exchange Friday.

Among gold stocks, IAMGOLD Corp. (IMG.TO) climbed 4.06 percent, Yamana Gold Inc. (YRI.TO) added 2.54 percent, Kinross Gold Corp. (K.TO) added 1.67 percent, Barrick Gold Corp. (ABX.TO) gained 2.78 percent, and Eldorado Gold (ELD.TO) gathered 2.84 percent. Goldcorp Inc. (G.TO) slipped 0.11 percent.

The Capped Materials Index edged down 0.06 percent, as Potash Corp. of Saskatchewan Inc. (POT.TO) fell 0.79 percent after the company again sent an unsolicited letter to the Board of Executive Directors and the Supervisory Board of K+S Aktiengesellschaft. Potash Corp is sticking to the proposed price of 41 euros per share for K+S Group.

Agnico Eagle Mines Limited (AEM.TO) gathered 0.84 percent.

Agrium Inc. (AGU.TO) added 1.12 percent, after reporting a stronger than expected second quarter profit, but trimmed the upper end of its full year earnings forecast.

Crude oil futures ended at a more than four-month low amid increased global supplies as the Organization of the Petroleum Exporting Countries continue to pump oil at a record pace to scuttle competition from U.S. producers.

The Energy Index fell 1.86 percent, with U.S. crude oil futures for September delivery, the most actively traded contract, plunging $0.79 or 1.8 percent, to settle at $43.87 a barrel on the New York Mercantile Exchange Friday.

Cenovus Energy Inc. (CVE.TO) fell 2.50 percent, Suncor Energy Inc. (SU.TO) dropped 0.43 percent, and Encana Corp. (ECA.TO) shed 2.88 percent

Among other energy stocks, Canadian Natural Resources Limited (CNQ.TO) dipped 0.06 percent, Crescent Point Energy Corp. (CPG.TO) fell 4.32 percent, Canadian Oil Sands (COS.TO) dived 5.34 percent, and Enbridge (ENB.TO) dropped 1.13 percent.

The Diversified Metals & Mining Index lost 2.07 percent, as Teck Resources Limited (TCK-B.TO) fell 3.20 percent, Lundin Mining Corp. (LUN.TO) dipped 1.32 percent, and First Quantum Minerals Ltd. (FM.TO) dropped 3.50 percent.

The heavyweight Financial Index dropped 0.85 percent, as National Bank of Canada (NA.TO) dipped 0.28 percent, Bank of Montreal (BMO.TO) fell 0.57 percent, and Royal Bank of Canada (RY.TO) dropped 0.95 percent.

Canadian Imperial Bank of Commerce (CM.TO) fell 0.44 percent, Bank of Nova Scotia (BNS.TO) dropped 0.22 percent, and Toronto-Dominion Bank (TD.TO) slipped 0.74 percent.

The Capped Health Care Index fell 0.16 percent as Valeant Pharmaceuticals International, Inc. (VRX.TO) dipped 0.13 percent, Extendicare Inc. (EXE.TO) dived 3.76 percent, and Concordia Healthcare Corp. (CXR.TO) gained 3.46 percent.

The Capped Information Technology Index fell 1.04 percent, as BlackBerry Limited (BB.TO) dropped 1.09 percent, Descartes Systems Group (DSG.TO) fell 0.94 percent, and Constellation Software Inc. (CSU.TO) surrendered 3.10 percent.

The Capped Telecommunication Index surrendered 0.54 percent, as Rogers Communication (RCI-B.TO) fell 0.94 percent and Manitoba Telecom Services Inc. (MBT.TO) dropped 0.51 percent

BCE Inc. (BCE.TO) fell 0.13 percent. TELUS Corp. (T.TO) dropped 0.54 percent, after reporting second-quarter adjusted earnings of C$0.66 per share, in line with consensus estimate.

The Capped Industrials Index gained 0.21 percent, as Bombardier (BBD.B.TO) fell 1.30 percent and Finning International Inc. (FTT.TO) moving up 2.00 percent.

Sierra Wireless (SW.TO) plummeted 8.74 percent, after its second quarter earnings topped expectations, although third quarter profit forecast was weaker than anticipated.

Inter Pipeline (IPL.TO) dropped 0.59 percent. The company reported second quarter FFO of $0.54 per share, compared to $0.41 per share last year.

AutoCanada (ACQ.TO) fell 1.44 percent. The company reported second quarter basic adjusted net earnings per share of $0.56 versus $0.61 per share last year.

Magna International (MG.TO) inched up 0.03 percent, after its second quarter profit surpassed expectations.

Enerplus (ERF.TO) gained 0.13 percent. The company reported that its second-quarter net loss was $312.54 million including a non-cash asset impairment charge of $497 million, while last year's net income was $39.96 million.

On the economic front, Statistics Canada also reported that Canadian building permits surged by 14.8 percent to C$7.74 billion in June. Economists were expecting a gain of only 5 percent.

In economic news, job growth in the U.S. slowed for the second consecutive month in July, a report from the Labor Department said Friday, with non-farm payroll employment rising by 215,000 jobs in July following an upwardly revised increase of 231,000 jobs in June and a jump of 260,000 jobs in May. Economists expected employment to climb by about 223,000 jobs.

The report also said the unemployment rate held at 5.3 percent in July, unchanged from the seven-year low set in June. This is in line with economist estimates.

German exports decreased for the first time in five months in June and imports fell unexpectedly, preliminary figures from Destatis showed Friday. Exports dropped 1.0 percent month-on-month in June, reversing a 1.6 percent climb in the previous month. Economists had expected a 0.3 percent fall for the month.

Imports also slid 0.5 percent monthly in June, confounding economists' expectations for a 0.5 percent gain. In May, imports had risen 0.7 percent. The seasonally and calendar-adjusted trade surplus came in at EUR 22.0 billion in June.

Germany's industrial production logged an unexpected decline in June, provisional data from Destatis revealed Friday. Industrial production dropped 1.4 percent month-on-month in June, which was the biggest fall since August, when it declined 2.8 percent. It was expected to rise 0.3 percent. In May, production grew by revised 0.2 percent.

The U.K. visible trade deficit widened in June, data from the Office for National Statistics showed Friday. The visible trade deficit increased to GBP 9.2 billion in June from GBP 8.4 billion in May. But it was smaller than the expected shortfall of GBP 9.3 billion.

French industrial output declined unexpectedly in June after rising in the previous month, the statistical office Insee reported Friday. Industrial production declined 0.1 percent month-on-month in June, in contrast to a 0.4 percent rise in May. Economists had expected a 0.2 percent increase for the month. In April, output had fallen 1.0 percent.

France's trade deficit sharply narrowed in June to reach its lowest level in more than eight years as exports grew robustly on the back of several large contracts, data from French Customs showed Friday. The trade deficit declined to EUR 2.658 billion from EUR 3.999 billion in May. The latest trade gap was the smallest since March 2007, when the shortfall was EUR 2.533 billion. A year ago, the trade deficit was EUR 5.529 billion.