TSX Falters After Firm Start, Ends Notably Lower

(RTTNews) - Despite opening on a positive note, the Canadian stock market ended notably lower on Tuesday, led by losses in materials, consumer staples, energy and financial sections.

Several stocks from healthcare, consumer discretionary, information technology and real estate sectors too drifted lower.

Commodity prices, which were firm earlier in the day, retreated and gave up most of their gains as the session progressed and this resulted in a sell-off at several counters in energy and materials sections.

U.S.-China trade war worries and the ongoing Canada-Saudi Arabia spat dragged the market down today.

After Canadian Foreign Ministry voiced its concern over the arrests of activists in Saudi Arabia last week, Saudi Arabia decided to expel the Canadian ambassador and also freeze all new trade and investment transactions with Canada.

Meanwhile, according to reports, Saudi Arabia's Ministry of Education has been instructed to stop training programs, scholarships and fellowships in Canada, and to facilitate the smooth transition of students to other countries. This move could have a big financial impact on Canada's economy, it is felt. The benchmark S&P/TSX index ended down 133.94 points or 0.82%, at 16,286.30, falling from the day's high of 16,494.09. The index touched a low of 16,280.95.

On Friday, the benchmark S&P/TSX Composite Index ended up 11.08 points, or 0.07%, at 16,420.24, after a lackluster session. The index scaled a low of 16,369.83 and a high of 16,429.12 intraday.

The Capped Materials Index lost 1.77%. Nutrien (NTR.TO), Franco-Nevada Corporation (FNV.TO), Barrick Gold Corporation (ABX.TO), Goldcorp Inc. (G.TO), First Quantum Minerals (FM.TO), Agnico Eagle Mines (AEM.TO), Wheaton Precious Metals Corp. (WPM.TO) and CCL Industries Inc. (CCL.B.T) declined by 1.5% to 3%. Lundin Mining (LUN.TO), Kinross Gold Corporation (K.TO)

The Capped Energy Index shed nearly 1%. Canadian Natural Resources (CNQ.TO). Husky Energy Inc. (HSE.TO), Vermilion Energy Inc. (VET.TO) and PrairieSky Royalty (PSK.TO) ended 1% - 2% down, while ARC Resources (ARX.TO) and Tourmaline Oil Corp. (TOU.TO) declined by 3.1% and 4.3%, respectively. Advantage Oil (AAV.TO) shed 4.2% and MEG Energy Corp. (MEG.TO) ended 2.7% down.

The Capped Consumer Staples Index shed 1.56%. Loblaw Companies (L.TO), Metro Inc. (MRU.TO), George Weston (WN.TO), Premium Brands Holdings Corporation (PBH.TO), Maple Leaf Foods Inc. (MFI.TO) and The North West Company Inc. (NWC.TO) lost 1 to 2.5%, while Empire Company Limited (EMP.A.TO) declined 3.6%

Saputo Inc. (SAP.TO) lost 4.4% after the company reported a 37.1% drop in net earnings at $126.0 million for the first quarter, compared to year-ago quarter.

The Capped Financial Index ended 0.77% down. Royal Bank of Canada (RY.TO), Bank of Nova Scotia (BNS.TO), Canadian Imperial Bank of Commerce (CM.TO) and National Bank of Canada (NA.TO) lost 0.5 to 1.2%. Bank of Montreal (BMO.TO) and Toronto-Dominion Bank (TD.TO) ended modestly lower.

Technology stock Constellation Software Inc.(CSU.TO), Open Text Corporation (OTEX.TO) and BlackBerry (BB.TO) declined by 1.3 to 2%, while Descartes Systems Group Inc. (DSG.TO) gained 1.15%, Kinaxis Inc. (KXS.TO) added about 2.2% and Celestica Inc. (CLS.TO) gained 2.7%.

In the healthcare space, Bausch Health gained nearly 3.5%, after reporting better than expected earnings in the June quarter.

Bombardier (BBD.B.TO) ended 2.9% down. Aurora Cannabis (ACB.TO) declined by 5.8%.

In Canadian economic news, Western University's IVEY School of Business said its Purchasing Managers Index for July came in at 61.8, down from June's reading of 63.1, and July 2017's level of 60.

In economic news from Europe, data from Destatis showed Germany's exports to have remained unchanged and industrial production to have declined more than expected in June.

The report showed that Exports registered nil growth in June from May after rising 1.7%. Economists had forecast a 0.4% drop. Meanwhile, monthly growth in imports accelerated to 1.2% from 0.7% in May. This was much faster than the expected 0.2% rise. Trade surplus fell to a seasonally adjusted EUR 19.3 billion from EUR 20.4 billion in May.

Industrial production decreased by more-than-expected 0.9% month-on-month in June, reversing a revised 2.4% rise in May, Destatis reported. Output was forecast to fall 0.5%.

In France, foreign trade gap widened in June, as imports grew faster than exports, figures from the Customs Office showed. The trade deficit rose to EUR 6.25 billion in June from EUR 6.02 billion in the previous month.

Elsewhere in UK, house prices increased at a faster pace in July to hit a record high level, data from the Lloyds bank subsidiary Halifax and IHS Markit showed. House prices grew 1.4% month-on-month in July, faster than the 0.9% rise in June. Economists had forecast a marginal 0.2% rise for July.

In commodities, crude oil futures for September pared early gains and were up $0.08, or 0.12%, at $69.09 a barrel.

Gold futures for December edged up marginally by $1.10, or 0.09%, at $1,218.80 an ounce.

Silver futures for September gained $0.037, or 0.24%, at $15.385 an ounce, while Copper futures were up $0.021, or 0.75%, at $2.752 per pound.