Canadian Stocks Are Down After 2 Days Of Gains -- Canadian Commentary

(RTTNews) - The Canadian stock market is trading to the downside Thursday morning, following the gains of the prior two trading sessions. The market got off to a positive start, but those early gains quickly eroded. Early strength in energy stocks has tapered off, while losses in gold stocks are overshadowing modest gains in other sectors.

Markets in Europe are turning in a mixed performance Thursday. Manufacturing data from China and the positive performance of the Asian markets were a source of strength in early trade. However, those gains have begun to erode after the drop in U.S. manufacturing data.

Markets in the United States are trading modestly to the downside this morning. The markets had been up in early trade, but turned lower after the weaker than expected ISM manufacturing report. Investors will be watching for the September jobs report on Friday.

With tomorrow's closely watched monthly jobs report looming, the Labor Department released a report on Thursday showing first-time claims for U.S. unemployment benefits rose by more than expected in the week ended September 26th.

The report said initial jobless claims climbed to 277,000, an increase of 10,000 from the previous week's unrevised level of 267,000. Economists had expected jobless claims to edge up to 271,000.

Partly reflecting concerns about the global economy and customer confidence, the Institute for Supply Management released a report on Thursday showing that its reading on activity in the U.S. manufacturing sector fell to a two-year low in September.

The ISM said its purchasing managers index dropped to 50.2 in September from 51.1 in August, although a reading above 50 indicates growth in the sector. Economists had expected the index to dip to 50.5.

With the bigger than expected decrease, the manufacturing index fell to its lowest level since hitting 50.1 in May of 2013.

Construction spending in the U.S. increased by slightly more than expected in the month of August, according to a report released by the Commerce Department on Thursday.

The report said construction spending climbed 0.7 percent to an annual rate of $1.086 trillion in August from the revised July estimate of $1.079 trillion. Economists had expected spending to rise by 0.6 percent.

The benchmark S&P/TSX Composite Index is down 47.98 points or 0.36 percent at 13,258.98.

On Wednesday, the index closed up 270.00 points or 2.07 percent, at 13,306.96. The index scaled an intraday high of 13,310.55 and a low of 13,135.19.

The Capped Health Care Index is advancing by 1.66 percent. Concordia Healthcare (CXR.TO) is rising 0.88 percent and Extendicare (EXE.TO) is gaining 0.12 percent.

The Diversified Metal and Mining Index is climbing 1.50 percent. HudBay Minerals (HBM.TO) is gaining 4.06 percent and First Quantum Minerals (FM.TO) is up 3.07 percent. Sherritt International (S.TO) is higher by 4.00 percent and Lundin Mining (LUN.TO) is advancing by 3.18 percent. Capstone Mining (CS.TO) is rising 1.14 percent.

The Energy Index is increasing by 1.38 percent. Crude oil prices rallied Thursday amid geopolitical tensions and worries about the impact of Hurricane Joaquin.

Canadian Natural Resources (CNQ.TO) is advancing by 0.81 percent and Encana (ECA.TO) is rising by 4.31 percent. Crescent Point Energy (CPG.TO) is adding 1.90 percent and Suncor Energy (SU.TO) is climbing 1.23 percent. Cenovus Energy (CVE.TO) is up 0.49 percent. Canadian Oil Sands (COS.TO) is gaining 2.22 percent and Enbridge (ENB.TO) is higher by 1.19 percent. Pacific Exploration & Production (PRE.TO) is surging by 4.03 percent.

The Capped Industrials Index is up 0.22 percent. Canadian Pacific Railway (CP.TO) is rising 0.60 percent and Air Canada (AC.TO) is climbing 0.93 percent. AutoCanada (ACQ.TO) is also adding 0.62 percent.

Bombardier (BBD-A.TO) is decreasing 2.96 percent. The company has closed the sale of its Military Aviation Training activities to CAE Inc. (CAE.TO) for C$19.8 million. CAE is gaining 1.34 percent.

The Capped Information Technology Index is gaining 0.06 percent. Constellation Software (CSU.TO) is up 1.55 percent and Avigilon (AVO.TO) is higher by 0.53 percent. Descartes Systems Group (DSG.TO) is advancing 1.48 percent.

The Capped Materials Index is down 1.02 percent. Agnico Eagle Mines (AEM.TO) is falling 0.83 percent and Franco-Nevada (FNV.TO) is losing 1.90 percent. Silver Wheaton (SLW.TO) is declining 1.37 percent and Agrium (AGU.TO) is lower by 2.80 percent. Potash Corp. of Saskatchewan is tumbling 2.66 percent.

The Gold Index is decreasing by 1.27 percent. Gold prices barely budged Thursday morning, having fallen in the previous session amid rising speculation the Federal Reserve will hike interest rates.

Eldorado Gold (ELD.TO) is losing 2.57 percent and B2Gold (BTO.TO) is falling 2.13 percent. Goldcorp (G.TO) is down 1.14 percent and Barrick Gold (ABX.TO) is declining 1.06 percent. Kinross Gold (K.TO) is dipping 0.43 percent and Yamana Gold (YRI.TO) is lower by 1.33 percent. IAMGOLD (IMG.TO) is also decreasing 1.38 percent.

The heavyweight Financial Index is falling 0.40 percent. Royal Bank of Canada (RY.TO) is declining 0.69 percent and Bank of Nova Scotia (BNS.TO) is lower by 0.24 percent. Bank of Montreal (BMO.TO) is losing 0.33 percent.

Toronto-Dominion Bank (TD.TO) is dipping 0.11 percent. The company announced that it is expanding its operations in Waterloo, creating more than 120 jobs over the next year.

The Capped Telecommunication Services Index is lower by 0.42 percent. TELUS (T.TO) is decreasing by 1.14 percent and Rogers Communication (RCI.TO) is down 0.28 percent. BCE (BCE.TO) is also losing 0.53 percent.

Penn West Petroleum (PWT.TO) is surging 8.33 percent, after it sold its non-operated 9.5% working interest in the Weyburn Unit in Southeast Saskatchewan for cash consideration of C$205 million.

Alimentation Couche-Tard (ATD-A.TO) is down 1.64 percent, after it completed the sale of its lubricants business in Europe.

Engineering and construction company SNC-Lavalin (SNC.TO) is up 1.58 percent, after it sold its 5% percent ownership in the Ambatovy Nickel Joint Venture Project to Sumitomo Corp, an existing partner, for about C$600 million.

On the economic front, China's manufacturing conditions deteriorated the most in six-and-a-half years in September as orders declined sharply on weak foreign demand, results of a private sector survey revealed Thursday.

The final manufacturing Purchasing Managers' Index dropped to 47.2 in September from 47.3 in August, survey data from the Caixin Insight Group and Markit showed. That was the lowest reading since March 2009. The health of the sector has weakened in each of the past seven months. The final reading was above the flash score of 47.

Meanwhile, the official manufacturing PMI rose moderately to 49.8 in September from 49.7 in August, reflecting marginal improvement in production and new orders.

Eurozone manufacturing activity grew at a slower pace as estimated in September, final data from Markit showed Thursday. The manufacturing Purchasing Managers' Index fell to a five-month low of 52 in September from 52.3 in August. The reading came in line with flash estimate.

Germany's manufacturing sector expanded less than initially estimated in September, survey data from Markit showed Thursday. The final Markit/BME manufacturing Purchasing Managers' Index dropped to 52.3 in September from 53.3 in August. The flash score was 52.5.

The French manufacturing sector returned to growth at a faster than estimated pace in September, final data from Markit showed Thursday. The manufacturing Purchasing Managers' Index came in at 50.6, up from 48.3 in August. It was above the flash estimate of 50.4.

British factory activity expanded at the weakest pace in three months in September, suggesting minimal support to the economy from manufacturing.

The seasonally adjusted Purchasing Managers' Index fell slightly to 51.5 in September from 51.6 in August, which was revised up from 51.5, survey figures from the Chartered Institute of Procurement & Supply and Markit Economics showed Thursday. Economists had forecast the index to fall to 51.3.

In commodities, crude oil futures for October delivery are up $1.40 or 3.10 percent at $46.49 a barrel.

Natural gas for October is down 0.032 or 1.27 percent at $2.492 per million btu.

Gold futures for December are up $0.70 or 0.06 percent at $1,115.90 an ounce.

Silver for December is up $0.067 or 0.46 percent at $14.585 an ounce.