TSX Ends Lower On Global Cues - Canadian Commentary

(RTTNews) - Canadian stocks ended lower Monday, driven by energy and financial stocks while tracking declining global equity markets as investors weighed some mixed economic data with a gauge of China's services industry dropping in December.

Asian stocks broadly ended lower, with Japanese shares bearing the brunt of the selling as investors played catch-up with the global sell-off during Japan's long holiday break. The European markets ended mixed amid cautious trade after weak cues from Asia.

China's service sector growth slowed in December to the weakest level since August 2011 as new work inflow weakened. A gauge of China's services industry dropped to 50.9 last month from 52.5 in November, data from HSBC and Markit economics showed, adding to signs of slowing growth in the world's second-largest economy. The data comes close on heels of a report by China's National Bureau of Statistics on Friday, which showed growth in the service-sector to have slowed to a four-month low.

The S&P/TSX Composite Index closed Monday at 13,495.54, down 53.32 points or 0.39 percent. The index scaled an intraday high of 13,560.64 and a low of 13,473.23. The Index had shed about 100 points or 0.50 percent in the past two sessions.

Crude oil continued drop on easing supply concerns for a fifth straight day, with investors expecting Libyan oil production and export to return to normal. Reports of South Sudan returning to production and increasing its shipments also pushed prices down.

The Energy Index dropped 0.01 percent, with U.S. crude oil futures for February delivery, the most actively traded contract, shedding $0.53 or 0.6 percent to close at $93.43 a barrel Monday on the Nymex.

Among energy stocks, Canadian Natural Resources Limited (CNQ.TO) dropped 0.14 percent, while Suncor Energy Inc. (SU.TO) ended flat at $36.58 a share. Talisman Energy Inc. (TLM.TO) shed 1.62 percent, while Encana Corp. (ECA.TO) gained 0.05 percent.

The Information Technology Index gained 0.82 percent, with smartphone maker BlackBerry Limited (BB.TO) surging 5.19 percent.

The Diversified Metals & Mining Index slipped 0.03 percent, with Teck Resources Limited (TCK.B.TO) down 0.33 percent and First Quantum Minerals Ltd. (FM.TO) down 0.05 percent.

The Capped Materials Index gained 0.48 percent, with fertilizer giant Potash Corp. of Saskatchewan Inc. (POT.TO) up 0.49 percent.

Gold futures ended lower on some mixed economic data globally. Nonetheless, outlook for gold seem bright with expectation of increased demand from China linked to its New Year and on news that India, the world's largest gold consumer, may likely relax curbs on gold import.

The Global Gold Index gained 0.64 percent, with gold futures for February delivery, the most actively traded contract, slipping $0.60 or 0.1 percent to close at $1,238.00 an ounce Monday on the Nymex.

Among gold stocks, Kinross Gold Corp. (K.TO) gained 2.08 percent, while Barrick Gold Corp. (ABX.TO) added 1.40 percent. Yamana Gold Inc. (YRI.TO) moved up 1.06 percent.

The Financial Index dropped 0.71 percent with Bank of Montreal (BMO.TO) slipping 0.28 percent, Royal Bank of Canada (RY.TO) down 0.97 percent, the Bank of Nova Scotia (BNS.TO) down 1.10 percent, and Toronto-Dominion Bank (TD.TO) losing 0.87 percent.

The Capped Industrials Index dipped 0.73 percent, with Bombardier Inc. (BBD.A.TO, BBD.B.TO) shedding 0.86 percent.

WestJet (WJA.TO) dipped 0.22 percent after its December 2013 traffic grew 7.2 percent year-on-year, with capacity rising 7.4 percent, while load factor slid 0.2 percentage points over the prior year.

Wireless broadband communications service provider TeraGo Inc. (TGO.TO) gained 1.91 percent after appointing Stewart Lyons, President and CEO of the company and a member of the Board of Directors effective January 6, 2014. The stock was up over 2 percent.

In economic news, Statistics Canada said the Industrial Product Price Index edged up 0.1 percent in November, mainly because of higher prices for motorized and recreational vehicles. Meanwhile, the Raw Materials Price Index fell 4.1 percent, led by crude energy products.

In economic news from the U.S., activity in the U.S. service sector unexpectedly grew at a slower rate in December, a report from the Institute for Supply Management showed Monday. The ISM non-manufacturing index edged down to 53.0 in December from 53.9 in November, although a reading above 50 still indicates growth in the service sector. The index dropped to its lowest level since hitting 52.8 in June. Economists expected the index at a reading of 54.8.

A Commerce Department report on Monday showed new orders for U.S. manufactured goods rose slightly more than expected in November, with orders for transportation equipment showing a notable rebound. Factory orders increased 1.8 percent in November following a revised 0.5 percent decrease in October. Economists expected orders to rise by 1.6 percent compared to the 0.9 percent drop reported for the previous month.

From the eurozone, German private sector growth slowed more than estimated initially in December, detailed results of a survey by Markit Economics showed. The headline composite output index, that measures combined performance of the country's manufacturing and services industries, fell to 55 in December from 55.4 in November.

Germany's EU harmonized inflation weakened more-than-expected in December, latest data revealed. The harmonized index of consumer prices increased 1.2 percent in December from the corresponding month last year, following a 1.6 percent gain in November. Economists anticipated 1.4 percent growth for December.

Eurozone investor confidence improved sharply in January to its highest since April 2011, a monthly survey by the think tank Sentix showed. The sentiment index rose 3.9 points to 11.9 in January. In Germany, investor sentiment rose to 32.4 in January from 32.1 a month ago.

Meanwhile, eurozone private sector growth accelerated as estimated in December, supported by strong performance of the manufacturing sector, final data from Markit Economics revealed. The seasonally adjusted composite output index, which measures performance of manufacturing and service sectors, rose to a three-month high of 52.1 in December from 51.7 in November. The outcome matched the flash estimates.