TSX Ends Sharply Lower On Global Cues -- Canadian Commentary

(RTTNews) - Canadian stocks slipped to end sharply lower for a third straight session on Wednesday, tracking declining global equity markets with all major sub-indices in the red after some mixed economic data from the U.S. and the disappointing Canadian GDP reported yesterday.

Besides speculation that the U.S. Federal Reserve may begin hiking interest rates sooner than earlier thought, worries about slowing Chinese economy and weak euro zone economic data contributed to the weakness.

Worries about the situation in Syria and the ongoing unrest in Hong Kong also weighed on the market.

Stocks began drifting lower in early trade despite a fairly strong U.S. private sector payrolls data. A report from payroll processor ADP showed employment in the U.S. private sector to have increased more than expected in September

Nevertheless, the Institute of Supply Management said growth in U.S. manufacturing activity slowed down notably in September, with the index of activity in the sector pulling back off a three-year high. Meanwhile, a U.S. Commerce Department report showed an unexpected drop in construction spending in August, with spending on both private and public construction declining.

The S&P/TSX Composite Index closed Wednesday at 14,805.44, down 155.07 points or 1.04 percent. The index scaled a intraday high of 14958.50 and a low of 14,764.02.

On Tuesday, the index closed down 16.41 points or 0.11 percent at 14,960.51, after scaling a intraday high of 15,047.13 and a low of 14,899.28.

Crude oil ended lower after the dollar continued to strengthen on some upbeat private jobs data from the U.S., notwithstanding some disappointing U.S. manufacturing data.

The Energy Index plunged 2.07 percent, with U.S. crude oil futures for November delivery dropping $0.43 or 0.5 percent to close at $90.73 a barrel Wednesday on the Nymex.

Among energy stocks, Encana Corp. (ECA.TO) shed 1.16 percent, Cenovus Energy Inc. (CVE.TO) fell 2.72 percent, Talisman Energy Inc. (TLM.TO) dropped 2.68 percent, and Canadian Natural Resources Limited (CNQ.TO) surrendered 3.17 percent. Suncor Energy Inc. (SU.TO) fell 1.26 percent, while Enbridge Inc. (ENB.TO) lost 1.16 percent.

The Financial Index fell 0.84 percent, with Toronto-Dominion Bank (TD.TO) down 1.70 percent, Canadian Imperial Bank of Commerce (CM.TO) down 0.66 percent, Royal Bank of Canada (RY.TO) fell 0.50 percent, Bank of Nova Scotia (BNS.TO) added 0.55 percent, and Bank of Montreal (BMO.TO) dropped 0.57 percent. Nonetheless, National Bank of Canada (NA.TO) slipped 1.23 percent.

Gold futures ended higher on some soft economic data from the U.S. with an ISM report showing manufacturing activity to have slowed down more than expected in September.

The Global Gold Index inched up 0.05 percent, with gold for December delivery adding $3.90 or 0.3 percent to settle at $1,215.50 an ounce on the New York Mercantile Exchange Wednesday.

Among gold stocks, Barrick Gold Corp. (ABX.TO) dropped 1.67 percent, Yamana Gold Inc. (YRI.TO) shed 1.93 percent, B2Gold Corp. (BTO.TO) gained 1.75 percent, Eldorado Gold Corp. (ELD.TO) up 1.06 percent, and Goldcorp Inc. (G.TO) gained 0.35 percent.

The Capped Materials Index declined 0.63 percent with Potash Corp. of Saskatchewan Inc. (POT.TO) down 1.13 percent.

The Diversified Metals & Mining Index fell 1.28 percent, with First Quantum Minerals Ltd. (FM.TO) down 1.16 percent, Lundin Mining Corp. (LUN.TO) up 0.90 percent, and Teck Resources Limited (TCK.B.TO) down 2.22 percent.

The Capped Industrials Index plummeted 2.10 percent, with Bombardier Inc. (BBD.B.TO) dropping 0.86 percent and SNC-Lavalin Group Inc. (SNC.TO) up 1.05 percent.

The Information Technology Index dropped 0.61 percent, with smartphone maker BlackBerry Limited (BB.TO) dropping 0.36 percent.

The Healthcare Index dipped 0.24 percent, with Valeant Pharmaceuticals International, Inc. (VRX.TO) up 0.24 percent, Extendicare Inc. (EXE.TO) down 0.24 percent, and Catamaran Corporation (CCT.TO) down 0.85 percent.

The Telecom Index dropped 0.30 percent with Rogers Communications Inc. (RCI.B.TO) down 0.26 percent, TELUS Corp. (T.TO) up 0.26 percent, and BCE Inc. (BCE.TO) down 0.1 percent.

The Consumer Staples Index slipped 0.04 percent, with Alimentation Couche-Tard Inc. (ATD.B.TO) down 1.14 percent.

TransCanada Corp. (TRP.TO) dropped 1.51 percent after announcing an agreement to sell its remaining 30 per cent interest in Bison Pipeline LLC to its master limited partnership, TC PipeLines LP (TCP) for cash proceeds of $215 million.

Cardinal Energy Ltd. (CJ.TO) fell 0.21 percent after the company said it has completed its previously announced acquisition in the Wainwright area of Alberta.

Cominar Real Estate Investment Trust (CUF.UN.TO) gained 0.48 percent after indicating the completion of the acquisition of a real estate portfolio from Ivanhoé Cambridge Inc. for an aggregate purchase price of approximately $1.35 billion.

In economic news from the U.S., a report from payroll processor ADP showed employment in the U.S. private sector to have increased more than expected in September, rising by 213,000 jobs, following a downwardly revised increase of 202,000 jobs in August.

A report from the Institute of Supply Management showed growth in U.S. manufacturing activity to have slowed down notably in September, with the index of activity in the sector pulling back off a three-year high, dropping to 56.6 from a score of 59.0 in August. Economists expected the index to edge down to 58.5.

Separately, a Commerce Department report revealed U.S. construction spending dropping unexpectedly in August, declining 0.8 percent to a seasonally adjusted annual rate of $961.0 billion from the revised July estimate of $968.8 billion. Economists expected spending to increase by about 0.5 percent.

In economic news from the eurozone, a report from Markit Economics showed manufacturing in the area move closer to stagnation in September, falling to 50.3 from a score of 50.7 in August, as German factory sector contracted for the first time in 15 months.

U.K. labor productivity remained flat in the second quarter despite faster economic growth, data from the Office for National Statistics showed Wednesday. Labor productivity as measured by output per hour was unchanged in the second quarter from the previous quarter, but was 0.3 percent lower than a year ago. However, productivity per worker increased 0.4 percent from last quarter.

The European Central Bank will come out with its monetary policy Thursday. It is widely expected that ECB will announce measures to spur growth.