TSX Edges Lower On Trade Concern

(RTTNews) - After snapping a six-day losing streak and ending modestly higher on Tuesday, the Canadian stock market faltered on Wednesday, as investors chose to stay away on the sidelines due to persistent worries about trade war.

Materials stocks saw some brisk buying as gold futures edged higher after the U.S. dollar weakened against some major currencies. Healthcare stocks were the other notable gainers. A few stocks from consumer discretionary sectors also edged higher. Financials, industrial and telecom stocks were weak, while energy and consumer staples stocks turned in a mixed performance.

According to media reports, China is putting off accepting license applications from American businesses hoping to operate in the country, as the Trump administration prepares to impose tariffs on all $500 billion-plus imports from China.

Already, China said on Tuesday that it would seek permission from the World Trade Organization next week to impose sanctions on U.S. goods in retaliation for Washington's non-compliance with a ruling in a dispute over dumping duties.

Meanwhile, with regards to NAFTA, reports indicate that Ottawa may offer the United States limited access to the Canadian dairy market as a concession in negotiations to remake the trade agreement.

On the economic front, a report from Statistics Canada this morning showed that Canadian industrial capacity utilization rose to 85.5% in the second quarter. Economists had expected a rate of 86.9%.

The benchmark S&P/TSX Composite Index ended down 45.23 points, or 0.28%, at 16,049.02, after scaling a low of 15,993.58 and a high of 16,096.09 intraday. On Tuesday, the index ended up 37.16 points, or 0.23%, at 16,094.25, snapping a six-day losing streak.

The Capped Materials Index gained 1.86%. Barrick Gold Corporation (ABX.TO) advanced by 2.6%, Teck Resources (TECK.B.TO) gained about 3%, Franco-Nevada Corporation (FNV.TO) jumped 5.2%, Wheaton Precious Metals Corp. (WPM.TO) climbed up 2.7%, Goldcorp Inc. (G.TO) added 1.3%, Kinross Gold (K.TO) gained 3%, First Quantum Minerals (FM.TO) gained 3.8%, Lundin Mining Corporation (LUN.TO) moved up nearly 4% and Agnico Eagle Mines (AEM.TO) advanced by 2.5%.

Energy stocks Encana Corporation (ECA.TO), Canadian Natural Resources (CNQ.TO), Suncor Energy (SU.TO) declined by 0.7% to 1%, while Crescent Point Energy (CP.TO) gained 0.8%.

The Capped Healthcare Index gained 1.15%. Bausch Health Companies Inc. (BHC.TO) shot up by 12.8%. The company announced on Tuesday that it has paid down an additional $57 million of its senior secured term loans and $50 million of its revolver borrowings, using cash on hand.

The stock's rise was also due to Bausch and Salix's licensors Cedars-Sinai Medical Center and Alfasigma SpA agreeing to resolve the outstanding intellectual property litigation with Actavis Laboratories FL, Inc., regarding Rrifaximin 550 mg tablets.

Aphria Inc. (APH.TO) declined by 3.6%, Knight Therapeutics Inc. (GUD.TO) ended lower by about 2% and Extendicare Inc. (EXE.TO) edged down by 1.2%.

Among bank stocks, Royal Bank of Canada (RY.TO), Toronto Dominion Bank (TD.TO), Bank of Montreal (BMO.TO), Canadian Imperial Bank of Commerce (CM.TO) and Bank of Nova Scotia (BNS.TO) declined by 0.5% - 1%. while National Bank of Canada (NA.TO) edged down marginally.

Among other markets, Wall Street showed a lack of direction over the course of the trading session before ending the day roughly flat.

Markets in Europe moved sideways on Wednesday, but the majority managed to end the day with modest gains. The mood was largely cautious ahead of policy decisions from both the European Central Bank and the Bank of England on Thursday.

Asian stocks ended on a muted note on Wednesday after China said it would seek permission from the World Trade Organization next week to impose sanctions on U.S. goods in retaliation for Washington's non-compliance with a ruling in a dispute over dumping duties.

In economic news from U.S., data released by the Labor Department said producer prices unexpectedly saw a modest decrease in the month of August. The Labor Department's producer price index for final demand edged down by 0.1% in August after coming in unchanged in July. Economists had expected prices to rise by 0.2%,

Meanwhile, the Federal Reserve's Beige Book said the U.S. economy expanded at a moderate pace through the end of August. The Fed's Beige Book is a compilation of anecdotal evidence on economic conditions in the twelve Fed districts released shortly before the central bank makes its decision on monetary policy.

In news from Eurozone, industrial production decreased for the second straight month in July, Eurostat reported.

Industrial output slid 0.8% month-on-month in July, the same pace of decline as seen in June. Economists had forecast a moderate drop of 0.5%.

In commodities, crude oil futures for October delivery delivery ended up $1.12, or 1.6%, at $70.37 a barrel, the best settlement price in about eight weeks, after data from EIA showed a notable drop in inventories.

Natural gas for October was down marginally at $2.825 per million btu.

Gold futures for December gained $8.70, or 0.7%, a they settled at $1,210.90 an ounce, the best settlement price in two weeks.

Silver futures for December edged up by $0.140 to $14.293 an ounce, while Copper futures for December settled at $2.6760 per pound, gaining $0.0545 for the session.