TSX Ends Lower Again On Trade Concerns

(RTTNews) - The Canadian stock market ended weak, extending its slide to a fourth successive session, due to worries about trade war and lower crude oil prices.

After a slightly weak start and a subsequent sharp plunge, the market recovered gradually and very nearly emerged into positive territory towards the closing minutes, but settled marginally down in the end.

As expected, the Bank of Canada kept its benchmark rate unchanged at 1.50% this morning. A report from Statistics Canada showed that the Canadian trade deficit narrowed to C$114 million in July, from C$743 million in June.

U.S. and Canadian officials are scheduled to hold trade talks in Washington today after failing to reach an agreement last week. Trump threatened on Saturday that U.S. would go it alone with Mexico on a revised agreement or to terminate NAFTA entirely. "There is no political necessity to keep Canada in the new NAFTA deal," he reportedly tweeted.

A report from Reuters said Canadian Prime Minister Justin Trudeau has indicated Canada will not bend on key demands regarding NAFTA in talks with the U.S. this week.

Reports indicating that the U.S. administration will likely move ahead with proposed tariffs on $200 billion worth of Chinese imports this week have raised fears about a full-blown global trade war.

Information technology stocks declined sharply. Energy stocks closed mostly lower. Materials, healthcare and consumer discretionary stocks were also weak. Consumer staples and telecom stocks moved up, while financials and industrials stocks ended mixed.

The benchmark S&P/TSX Composite Index ended lower by 23.73 points or 0.15%, at 16,137.57, after scaling a low of 16.032.96 and a high of 16,156.75 intraday.

The Capped Information Technology Index ended more than 2% down. BlackBerry (BB.TO) plunged by about 6.1%, Shopify Inc. (SHOP.TO) ended 4.25% down, Constellation Software Inc. (CSU.TO) declined by 2% and Descartes Systems Group Inc. (DSG.TO) ended 1.7% down, while Open Text Corporation (OTEX.TO) and Kinaxis Inc. (KXS.TO) both ended lower by about 1.1%.

The Capped Energy Index shed 0.79%. Tourmaline Oil Corp. (TOU.TO) declined by 3.6% and ARC Resources (ARX.TO) ended 1.3% down.

The Capped Materials Index declined 0.77%. Franco-Nevada Corporation (FNV.TO), First Quantum Minerals (FM.TO), Agnico Eagle Mines (AEM.TO) and Wheaton Precious Metals Corp. (WPM.TO) lost 1.4% t0 2%.

The Capped Healthcare Index edged down by 1.27%. Aurora Cannabis Inc. (ACB.TO) lost 3%, Bausch Health Companies Inc. (BHC.TO) ended nearly 2% down and Knight Therapeutics Inc. (GUD.TO) declined by 1.9%, while Extendicare (EXE.TO) gained 1.1%.

Aphria Inc. (APH.TO) and Rapid Dose Therapeutics Inc., a Canadian bio-technology company, have announced that they have signed a non-binding Memorandum of Understanding related to RDT's QuickStrip products. Aphria Inc. shares declined marginally.

Among bank stocks, Toronto-Dominion Bank (TD.TO) gained 0.8%, Canadian Imperial Bank Of Commerce (CM.TO) ended up 0.71%, Bank of Montreal (BMO.TO) edged up by 0.4% and Bank of Nova Scotia (BNS.TO) ended 0.3% down. while Royal Bank of Canada (RY.TO) and Canadian Imperial Bank of Commerce (CM.TO) ended flat.

Cronos Group Inc. (CRON.TO) ended nearly 12% up. Hexo Corp. (HEXO.TO) gained about 2.5% and Enbridge (ENB.TO) advanced by 1.6%.

Nevsun Resources (NSU.TO) vaulted nearly 18% after the company announced that it has entered into a definitive agreement with Zijin Mining Group Co. Ltd., pursuant to which Zijin will make a take-over bid to acquire all of the issued and outstanding shares of Nevsun for C$6.00 per share in cash.

Baytex Energy (BTE.TO) ended nearly 4% down and Crescent Point Energy Corp. (CPG.TO) declined by 2.7%.

Crescent Point Energy Corp. announced that it plans to reduce its workforce by 17%, sell some infrastructure assets and reduce its debt by more than $1 billion by the end of 2019.

Enercare Inc. (ECI.TO) has announced a cash dividend of $0.0832 per common share which will be payable on September 28, 2018.

U.S. stocks closed mostly lower, although the Dow edged up slightly. The European markets ended firmly in negative territory, extending the weakness from the previous day.

Asian stocks drifted lower on Wednesday, extending recent losses, amid persisting concerns about trade tensions and the turbulence in emerging markets, with South Africa slipping into a recession for the first time since 2009.

In economic news from U.S., a report released by the Commerce Department showed U.S. trade deficit widened in the month of July. The report showed trade deficit to have widened to $50.1 billion in July from a revised $45.7 billion in June. Economists had expected the deficit to widen to $50.1 billion from the $46.3 billion originally reported for the previous month.

In Europe, final data from IHS Markit showed that the euro area private sector expanded slightly more than initially estimated in August, with the composite output index rising to 54.5 in the month from July's 54.3. The score was marginally above the flash estimate of 54.4.

Separately, Eurozone retail sales fell 0.2% month-on-month in July, in contrast to a 0.3% rise in June, Eurostat reported. This was the first fall since April, when sales were down 0.2%.

Meanwhile, U.K. services sector expanded at a faster pace in August on stronger new orders, survey data from IHS Markit showed.

In news from Asia, activity in China's services sector continued to expand in August, albeit at a slower rate, the latest survey from Caixin revealed with a 10-month low PMI score of 51.5. That missed expectations for 52.6 and was down sharply from 52.8 in July.

In commodities, crude oil futures for October delivery ended down $1.15, or 1.7%, at $68.72 a barrel. Natural gas futures edged up by 0.21% to $2.829 per million btu.

Gold futures for December ended up $2.20, or 0.2%, at $1,201.30 an ounce.

Silver futures for December ended up $0.040, at $14.220 an ounce, while Copper futures for December settled at $2.6100 per pound, gaining $0.0080 for the session.