TSX Wavers Amid Geopolitical Tensions -- Canadian Commentary

(RTTNews) - After a weak start on the back of a disappointing report on Chinese service sector activity, Canadian stocks are coming off their lows Tuesday mid morning with investors going in for some bargain hunting after last week's losses.

Investors appeared wary of going in for any significant buying early on with upbeat data on U.S. service sector growth and factory orders raising prospects of a Fed rate hike sometime sooner than anticipated earlier.

Sluggish commodity prices and lingering geopolitical worries too contributed to the weakness in the market.

The benchmark S&P/TSX Composite Index is up 9.44 points or 0.06 percent at 15,224.70, after having declined to 15,157.59 earlier.

On Friday, the index ended down 115.48 points or 0.75 percent at 15,215.26. The index shed more than 1.5 percent in the week.

The Healthcare index is down more than 2.5 percent with Valeant Pharmaceuticals Inc. (VRX) going down by over 5 percent. Botox maker Allergan Inc (AGN) commented that its financial advisors and forensic accountants analyzed Valeant's reported financial and operating results, identifying numerous inconsistencies and omissions.

Catamaran Corporation (CCT.TO) is declining more than 3 percent, while Extendicare Inc (EXE.TO) is gaining about 0.4 percent.

Gold stocks are the other notable losers. The Capped Materials Index has shed 0.9 percent. Goldcorp Inc. (G.TO), Barrick Gold Corporation (ABX.TO), Silver Wheaton Corp. (SLW.TO), Franco-Nevada Corporation (FNV.TO), Agnico Eagle Mines Limited (AEM.TO) and Yamana Gold Inc. (YRI.TO) are down 1 to 3 percent.

Diversifed Materials Index is down 0.5 percent, with Lundin Mining Corporation (LUN.TO), HudBay Minerals Inc. (HBM.TO), Sherritt International Corporation (S.TO), Capstone Mining Corp. (CS.TO), Nevsun Resources Ltd. (NSU.TO) and Major Drilling Group International Inc. (MDI.TO) losing 1 to 2.5 perent.

Energy stocks are turning in a mixed performance. The Energy Index is up marginally. Athabasca Oil Corporation (ATH.TO), Talisman Energy (TLM.TO) and Canadian Oil Sands (COS.TO) are rising 0.7 to 1.4 percent. Meanwhile, Suncor Energy (SU.TO) and Surge Energy (SGY.TO) are lower by over 0.5 percent. Encana Corporation (ECA.TO) is down marginally.

Among big six banks, Royal Bank of Canada (RY.TO), Bank of Montreal (BMO.TO) and National Bank of Canada (NA.TO) are rising over 0.5 percent.

Telecom stocks Rogers Communications Inc. (RCI.B.TO) and Manitoba Telecom Services Inc. (MBT.TO) are advancing 1.4 percent and 1.2 percent, respectively.

Among industrial stocks, Canadian Pacific Railway Limited (CP.TO) and SNC-Lavalin Group Inc. (SNC.TO) are up 1.5 percent and 1.3 percent, respectively. Meanwhile, Bombardier Inc (BBD.B.TO) and CAE Inc. (CAE.TO) are notably lower.

Fortis Inc. (FTS.IR.TO) is moving up 2.3 percent. Technology stock BlackBerry (BB.TO) is rising 2.7 percent.

Enghouse Systems Ltd. (ESL.TO) is up more than 1 percent. The company announced Tuesday that it has acquired Jinny Software Limited from Italy's Acotel Group S.p.A. for approximately $19.3 million. The deal is expected to expand Enghouse's mobile telephony solutions.

Saputo Inc. (SAP.TO) is up more than 1 percent after reporting first quarter net earnings of C$145.3 million, up from the previous year' C$136.7 million, with earnings per share improving to C$0.73 from C$0.69 last year.

Ritchie Bros. Auctioneers Inc. (RBA.TO) reported second-quarter earnings of $39.13 million or $0.36 per share, from $30.03 million or $0.28 per share. The stock is down marginally.

Novadaq Technologies Inc. (NDQ.TO) shares are down more than 7.5 percent despite the company reporting a net income of $6.3 million for the second quarter of 2014, as against net loss of $9.7 million in second quarter of 2013.

Allied Nevada Gold Corp. (ANV.TO) is declining 1.7 percent after reporting second quarter net income of $4.4 million, or $0.04 per share, almost in line with a net income of $4.2 million, or $0.04 per share, in the second quarter of 2013.

HSBC Bank Canada (HSB.PR.C.TO) reported Monday that its profit attributable to the common shareholder for the quarter ended 30 June 2014 was C$172 million, an increase of 52.2 percent from the year ago quarter. The stock is adding 0.3 percent.

In commodities, crude oil futures for September are down $0.75 or 0.76 percent at $97.54 a barrel.

Natural gas for September is up $0.057 or 1.47 percent at $3.891 per million btu.

Gold futures for December is down $3.20 or 0.25 percent at $1,285.70 an ounce.

Silver for September is down $0.400 or 1.98 percent at $19.833 an ounce.

Meanwhile, copper is down $0.035 or 1.09 percent at $3.209 on likely fall in demand after a report showed Chinese service sector to have grown at its slowest pace in almost nine years.

No Canadian economic data is due for release today.

Data released by the Commerce Department showed U.S. factory orders jumped by a more than expected 1.1 percent in June, following a revised 0.6 percent decrease in May. Economists had been expecting orders to increase by about 0.6 percent compared to the 0.5 percent drop originally reported for the previous month.

According to a report from the Institute of Supply Management, activity in the U.S. service sector expanded at a notably faster rate in the month of July, with the non-manufacturing index climbing to 58.7, the highest reading since its inception in January 2008. Economists had been expecting the index to edge up to a reading of 56.5.