The Canadian stock market got off to a good start Tuesday morning, but weakness in the U.S. and Europe has dragged it into negative territory. Investors are on edge this morning after Turkey shot down a Russian jet near the border with Syria. Energy and mining stocks are among the best performers as commodity prices attempt to rebound.
Markets in Europe are firmly in negative territory Tuesday. Geopolitical concerns are weighing on the markets, after Turkey shot down a Russian jet near the border with Syria. The Russian-made SU-24 was reportedly shot down after receiving repeated warnings about entering Turkish air space, although Russia claims the jet remained in Syria for the duration of its flight.
Markets in the United States are trading modestly to the downside Tuesday morning. Stocks turned in a relatively lackluster performance throughout the trading day on Monday and are extending that weakness this morning. Geopolitical concerns are weighing on sentiment as concerns about escalating tensions in Syria have offset optimism about a potential alliance between Russia and the West in the fight against ISIS.
Economic activity in the U.S. increased by more than previously estimated in the third quarter, according to a report released by the Commerce Department on Tuesday. The report said real gross domestic product climbed by 2.1 percent in the third quarter compared to the previously reported 1.5 percent increase. The upward revision matched economist estimates.
Home prices in major U.S. metropolitan areas rose by more than expected in the month of September, according to a report released by Standard & Poor's on Tuesday. The report said the S&P/Case-Shiller 20-City Composite Home Price Index increased by a seasonally adjusted 0.6 percent in September after inching up by 0.1 percent in August. Economists had expected the index to rise by 0.3 percent.
Consumer confidence in the U.S. has unexpectedly seen a substantial deterioration in the month of November, the Conference Board revealed in a report on Tuesday. The Conference Board said its consumer confidence index tumbled to 90.4 in November from an upwardly revised 99.1 in October.
The steep drop came as a surprise to economists, who had expected the index to climb to 99.6 from the 97.6 originally reported for the previous month.
The benchmark S&P/TSX Composite Index is down 11.26 points or 0.08 percent at 13,371.12.
On Monday, the index closed down 51.11 points or 0.38 percent, at 13,382.38. The index scaled an intraday high of 13,508.09 and a low of 13,372.04.
The Diversified Metal and Mining Index is advancing 2.39 percent. First Quantum Minerals (FM.TO) is gaining 7.27 percent and Capstone Mining (CS.TO) is rising 1.27 percent. HudBay Minerals (HBM.TO) is up 1.81 percent and Lundin Mining (LUN.TO) is increasing 2.80 percent. Sherritt International (S.TO) is also higher by 2.03 percent.
The Energy Index is increasing 1.41 percent. Crude oil prices rallied Tuesday morning amid fears of a wider conflict in the Middle East.
Suncor Energy (SU.TO) is rising 0.68 percent and Husky Energy (HSE.TO) is up 1.04 percent. Encana (ECA.TO) is surging 4.50 percent and Canadian Natural Resources (CNQ.TO) is gaining 1.09 percent. Cenovus Energy (CVE.TO) is increasing 1.50 percent and Crescent Point Energy (CPG.TO) is higher by 1.73 percent. Enbridge (ENB.TO) is rising 0.43 percent and Canadian Oil Sands (COS.TO) is adding 1.64 percent. Imperial Oil (IMO.TO) is also advancing 1.53 percent.
The Gold Index is rising 0.80 percent. Gold prices climbed Tuesday morning, edging away from 5-year lows as the dollar wavered against major rivals. The precious metal is in demand thanks to its perceived safe haven status.
Goldcorp (G.TO) is increasing 0.06 percent and Kinross Gold (K.TO) is climbing 4.29 percent. IAMGOLD (IMG.TO) is rising 3.59 percent and Yamana Gold (YRI.TO) is adding 3.25 percent.
Barrick Gold (ABX.TO) is declining 0.84 percent. The company reported a mechanical issue at its Pueblo Viejo mine in the Dominican Republic. Problems with motors are expected to result in reduced production until mid-January 2016.
The Capped Materials Index is also up 0.55 percent. Agnico Eagle Mines (AEM.TO) is climbing 1.33 percent and Franco-Nevada (FNV.TO) is advancing 1 percent. Silver Wheaton (SLW.TO) is higher by 0.36 percent.
The Capped Industrials Index is down 1 percent. Canadian National Railway (CNR.TO) is losing 1.61 percent and Canadian Pacific Railway (CP.TO) is lower by 0.89 percent. Air Canada (AC.TO) is declining 1.74 percent and Finning International (FTT.TO) is falling 0.55 percent.
Bombardier (BBD-A.TO) is decreasing 2.13 percent. The company announced at its Investor Day that the previously announced reduction in jet production will result in lower revenues in 2016.
The Capped Information Technology Index is down 0.72 percent. Constellation Software (CSU.TO) is losing 1.43 percent and Descartes Systems Group (DSG.TO) is falling 2.16 percent.
The Capped Health Care Index is losing 0.66 percent. Concordia Healthcare (CXR.TO) is down 2.12 percent.
Valeant Pharmaceuticals International (VRX.TO) dipping 0.24 percent. Bill Ackman's Pershing Square Capital Management disclosed in a regulatory filing that it raised its stake in the company to 9.9 percent. Ackman's firm had previously disclosed a 5.7 percent stake in the drug maker, as of September 30.
The Capped Telecommunication Services Index is lower by 0.79 percent. Rogers Communication (RCI-A.TO) is down 1.52 percent and BCE (BCE.TO) is declining 2.50 percent.
The heavyweight Financial Index is falling 0.33 percent. Royal Bank of Canada (RY.TO) is losing 0.56 percent and National Bank of Canada (NA.TO) is declining 0.26 percent. Toronto-Dominion Bank (TD.TO) is dipping 0.02 percent and Bank of Nova Scotia (BNS.TO) is down 0.58 percent. Bank of Montreal (BMO.TO) is decreasing 0.56 percent and Canadian Imperial Bank of Commerce (CM.TO) is surrendering 0.21 percent.
George Weston (WN.TO) Q3 EPS surged to C$1.15 from C$0.30 last year. The stock is now down 0.17 percent.
Alimentation Couche-Tard (ATD-A.TO) is gaining 1.71 percent. Second quarter adjusted EPS was $0.66, which topped the consensus estimate of $0.64.
On the economic front, German business confidence unexpectedly rose in November to its highest level since the middle of last year, offering more evidence that the biggest euro area economy continues to remain unscathed by events such as the Volkswagen pollution cheating scandal and the Paris terrorist attacks.
The business confidence index rose to 109 from 108.2 in October, marking its best reading since June 2014's 109.4, the results of the monthly survey by the Munich-based Ifo Institute showed Tuesday. Economists had expected the index to hold steady after easing in the previous month.
Germany's economic growth slowed as estimated in the third quarter on weak foreign trade and investment, data published by Destatis showed Tuesday. Gross domestic product advanced 0.3 percent from the prior quarter, in line with the preliminary estimate published on November 13. But the pace of growth eased from 0.4 percent expansion seen in the previous quarter.
French manufacturing confidence dropped for the second straight month in November as expected, though slightly, figures from the statistical office Insee showed Tuesday. The manufacturing confidence index fell marginally to 102 in November from 103 in the previous month. The reading was also came in line with expectations.
In commodities, crude oil futures for December delivery are up $1.40 or 3.35 percent at $43.15 a barrel.
Natural gas for December is down 0.061 or 2.76 percent at $2.149 per million btu.
Gold futures for December are up $7.90 or 0.74 percent at $1,074.70 an ounce.
Silver for December is up $0.113 or 0.81 percent at $14.145 an ounce.
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