TSX Ends Lower On Commodities - Canadian Commentary

(RTTNews) - Canadian stocks snapped a five-day gain to end lower Tuesday, driven by declining commodity prices on speculations the U.S. Federal Reserve could further taper down its quantitative easing program. Nonetheless, the down trend was limited as China moved to supply more liquidity into the system ahead of the Lunar New Year holidays, easing fears over a credit squeeze and a slowdown in demand for commodities.

Elsewhere, the Asian markets ended broadly higher after China moved to supply more liquidity into the system. Meanwhile, European stocks ended mostly higher with investors shrugging off some weak and unexpected German economic confidence report for January. The indicator of economic sentiment fell 0.3 points to 61.7 versus 64.0 expected.

The S&P/TSX Composite Index closed Tuesday at 13,951.77, down 38.52 points or 0.28 percent. The index scaled an intraday high of 13,999.60 and a low of 13,948.26.

Gold futures ended lower on speculations the Federal Reserve would further taper down its quantitative easing program, with little or no economic releases for cues.

The Global Gold Index added 0.03 percent, with gold futures for February delivery, the most actively traded contract, down $10.10 or 0.8 percent to close at $1,241.80 an ounce Tuesday on the Nymex.

Among gold stocks, Goldcorp Inc. (G.TO) added 0.23 percent, while Barrick Gold Corp. (ABX.TO) slipped 2.18 percent. Yamana Gold Inc. (YRI.TO) dropped 0.74 percent, while Kinross Gold Corp. (K.TO) surrendered 0.85 percent.

B2Gold Corp. (BTO.TO) slipped 0.37 percent after reporting its fourth-quarter gold revenue of $138 million, up 95 percent from last year's $70.8 million. Looking ahead, B2Gold expects another record year for gold production in 2014.

The Capped Materials Index dropped 0.88 percent, with fertilizer giant Potash Corp. of Saskatchewan Inc. (POT.TO) slipping 1.33 percent.

Fertilizer and agricultural products company Agrium, Inc. (AGU.TO) lost 1.28 percent after trimming its fourth quarter 2013 earnings from continuing operations to the bottom of its prior guidance range of $0.80 to $1.25 per share.

Crude oil ended higher driven mostly by easing demand growth concerns after the International Energy Agency in a monthly report raised its demand growth forecast.

The Energy Index inched up 0.02 percent, with U.S. crude oil futures for March delivery, the most actively traded contract, gaining $0.38 or 0.4 percent to close at $94.97 a barrel Tuesday on the Nymex.

Among energy stocks, Canadian Natural Resources Limited (CNQ.TO) added 0.28 percent, while Suncor Energy Inc. (SU.TO) dropped 0.11 percent. Talisman Energy Inc. (TLM.TO) shed 1.09 percent, while Encana Corp. (ECA.TO) added 0.46 percent.

The Information Technology Index slipped 0.05 percent, with smartphone maker BlackBerry Limited (BB.TO) up 1.30 percent.

The Diversified Metals & Mining Index dropped 0.59 percent, with Teck Resources Limited (TCK.B.TO) shed 3.37 percent and First Quantum Minerals Ltd. (FM.TO) gaining 2.11 percent. Lundin Mining Corp. (LUN.TO) added 1.19 percent.

The Financial Index dropped 0.12 percent with Bank of Montreal (BMO.TO) down 0.18 percent and Royal Bank of Canada (RY.TO) up 0.16 percent. The Bank of Nova Scotia (BNS.TO) surrendered 0.22 percent, while Toronto-Dominion Bank (TD.TO) moved up 0.15 percent.

The Capped Industrials Index shed 0.38 percent with Bombardier Inc. (BBD.A.TO, BBD.B.TO) dropping 3.89 percent.

In economic news, Statistics Canada said wholesale sales were flat in November at $50.4 billion, with lower sales in five sub-sectors, representing 63 percent of wholesale sales, offset by higher sales in the motor vehicle and parts sub-sector and the food, beverage and tobacco sub-sector.

Separately, the agency said, manufacturing sales increased 1.0 percent in November to $50.5 billion, hitting their highest level since December 2011.

In economic news from the eurozone, Germany's economic confidence weakened unexpectedly in January, survey data from the Centre for European Economic Research/ZEW showed. The indicator of economic sentiment fell 0.3 points to 61.7 in January. The score was expected to rise to 64.

Elsewhere, China's short-term interest rates declined on Tuesday after the central bank added funds twice this week ahead of Lunar New Year holiday. The People's Bank of China pumped CNY 255 billion via reverse-repurchase agreement today. The bank also offered funds to large commercial banks on Monday, following a sharp rise in money market rates. The actions aim to ensure adequate liquidity and stability in the financial market.