The Canadian stock market is declining Thursday morning, following two days of gains. Global markets are under pressure today due to concerns over Greece and some weak U.S. economic data. Weakness in commodities and crude oil prices are also having a negative impact on the Canadian market.
Markets in Europe are trading in the red Thursday, as concerns over the situation in Greece persist. Standard & Poor's Ratings Services cut its credit ratings on Greece deeper into junk territory, saying it expects the country's debt and other financial commitments to be "unsustainable" without deep economic reform.
Markets in the United States are also down Thursday morning, due to some weaker than expected economic data. Weekly jobless claims showed an unexpected increase, while housing starts and building permits both came in weaker than expected.
After reporting a notable rebound in first-time claims for U.S. unemployment benefits in the previous week, the Labor Department released a report on Thursday showing that initial jobless claims unexpectedly saw another increase in the week ended April 11th.
The report said initial jobless claims climbed to 294,000, an increase of 12,000 from the previous week's revised level of 282,000. The increase came as a surprise to economists, who had expected jobless claims to edge down to 280,000 from the 281,000 originally reported for the previous week.
While the Commerce Department released a report on Thursday showing a rebound in new U.S. residential construction in the month of March, housing starts still came in well below economist estimates for the month.
The report said housing starts rose 2.0 percent to an annual rate of 926,000 in March after tumbling 15.3 percent to a rate of 908,000 in February. Economists had been expecting housing starts to jump to a rate of 1.04 million.
The Commerce Department also said building permits, an indicator of future housing demand, fell 5.7 percent to an annual rate of 1.039 million in March after climbing 4 percent to a rate of 1.102 million in February. Economists had been expecting building permits to show a much more modest decrease to a rate of 1.085 million.
Growth in Philadelphia-area manufacturing activity has seen a modest acceleration in the month of April, according to a report released by the Federal Reserve Bank of Philadelphia on Thursday. The Philly Fed said its diffusion index of current activity rose to 7.5 in April from 5.0 in March, with a positive reading indicating growth in regional manufacturing activity. Economists had expected the index to inch up to 6.0.
The benchmark S&P/TSX Composite Index is down 90.64 points or 0.59 percent at 15,360.23.
On Tuesday, the index closed up 61.59 points or 0.40 percent, at 15,450.87. The index scaled an intraday high of 15,524.75 and a low of 15,437.02.
The Energy Index is decreasing by 1.56 percent. Crude oil prices turned lower Thursday morning after a strong rally over the previous few sessions. Traders booked profits after tensions in the Middle East and the prospect for increased demand fueled a furious run above $56 barrel.
Encana (ECA.TO) is losing 0.06 percent and Crescent Point Energy (CPG.TO) is decreasing by 1.54 percent. Legacy Oil + Gas (LEG.TO) is falling by 1.18 percent and Cenovus Energy (CVE.TO) is down 2.26 percent.
Suncor Energy (SU.TO) is declining by 1.27 percent and Canadian Oil Sands (COS.TO) is lower by 3.04 percent. Canadian Natural Resources (CNQ.TO) is surrendering 2.98 percent and Tourmaline Oil (TOU.TO) is weaker by 1.05 percent.
The Gold Index is falling by 0.82 percent. Gold prices rose further above $1200 an ounce Thursday morning, boosted by concerns that Greece will spark a wider crisis in the euro zone.
Goldcorp (G.TO) is decreasing by 1.14 percent and Yamana Gold (YRI.TO) is falling by 2.40 percent. Barrick Gold (ABX.TO) is losing 1.14 percent and Eldorado Gold (ELD.TO) is dropping by 1.11 percent. IAMGOLD (IMG.TO) is declining 2.25 percent and Kinross Gold (K.TO) is surrendering 1.06 percent.
The Diversified Metal and Mining Index is falling by 1.36 percent. HudBay Minerals (HBM.TO) is declining by 4.73 percent and Sherritt International (S.TO) is dipping by 0.47 percent. Finning International (FTT.TO) is losing 1.11 percent and Teck Resources (TCK-A.TO) decreasing by 1.95 percent.
The Capped Materials Index is also lower by 0.86 percent. Agnico Eagle Mines (AEM.TO) is falling by 1.29 percent and Franco-Nevada (FNV.TO) is down 0.73 percent. Silver Wheaton (SLW.TO) is also lower by 1.09 percent.
The heavyweight Financial Index is down 0.43 percent. Bank of Nova Scotia (BNS.TO) is losing 0.44 percent and Canadian Imperial Bank of Commerce (CM.TO) is falling by 0.21 percent. Royal Bank of Canada (RY.TO) declining 0.47 percent and Toronto-Dominion Bank (TD.TO) is down 0.41 percent. Bank of Montreal (BMO.TO) is lower by 0.50 percent.
National Bank of Canada (NA.TO) is higher by 0.27 percent. The company announced that its Board has authorized the repurchase of up to 6,000,000 of its issued and outstanding common shares.
The Capped Health Care Index is rising by 0.61 percent. Valeant Pharmaceuticals International (VRX.TO) is higher by 0.37 percent and Extendicare (EXE.TO) is gaining 0.91 percent.
The Capped Information Technology Index is lower by 0.41 percent. Constellation Software (CSU.TO) is declining by 0.75 percent and BlackBerry (BB.TO) is lower by 0.24 percent. Descartes Systems Group (DSG.TO) is also falling by 0.55 percent.
Corus Entertainment (CJR-B.TO) is up 1.46 percent, after it secured the Canadian licensing rights to Disney Channel's content.
Canadian National Railway (CNR.TO) is falling by 0.16 percent. The company announced that it will invest approximately C$500 million in infrastructure improvements to its Western Canada feeder rail lines.
On the economic front, Foreign direct investment in China increased in March from a year ago, the Commerce Ministry said on Thursday. In March, foreign direct investment climbed 2.2 percent year-over-year to $12.4 billion, which was much higher than February's 0.9 percent rise.
The leading economic index in the UK, which measures the future economic activity, increased for the second straight month in February, the results of a survey by the Conference Board showed Wednesday. The Conference Board leading economic index climbed 0.6 percent in February, following a 0.2 percent rise in the previous month. The latest figure marked its largest monthly increase since June 2014.
In commodities, crude oil futures for May delivery are down $0.93 or 1.65 percent at $55.46 a barrel.
Natural gas for May is down $0.007 or 0.27 percent at $2.603 per million btu.
Gold futures for June are down $0.80 or 0.07 percent at $1,200.50 an ounce.
Silver for May is down $0.034 or 0.21 percent at $16.245 an ounce.
For comments and feedback contact: editorial@rttnews.com
Market Analysis