TSX Ends Lower On Greece, Weakness In Commodities -- Canadian Commentary

(RTTNews) - Canadian stocks ended firmly lower for a second straight session on Friday, as commodity prices dropped and concerns over the impasse in the Greek debt negotiations persisted, although talks are slated to continue into the weekend and on a decline in commodity prices. All major indices ended in the red, led by sharp declines in energy, gold and materials stocks.

The majority of the European markets ended in the green, on reports that Greece's creditors have proposed a five-month extension to its current bailout program if the government agrees to a set of reforms.

Markets in the United States ended mostly in the red, as investors remained largely focused on the developments in Greece.

Elsewhere, Chinese stocks plunged with the Shanghai Composite Index down 7.4 percent on speculation that equities were far too highly overvalued. The Shanghai market plummeted a near 20 percent from its recent highs, with Chinese start-ups surrendering a quarter of their value after having touched a record high earlier this month.

Talks between creditors and Greek Prime Minister Alexis Tsipras failed to produce any deal on Thursday and a Eurogroup meeting later, apparently viewed proposals from both sides.

Under the new proposal, the massive EUR 240 billion bailout will be extended until end November, when a total EUR 12 billion aid will be offered. The current program is set to expire at the end of this month and extension could give Greece more time to hold negotiations with creditors to reach a feasible solution.

Reports say Greece may be given EUR 1.8 billion as the first tranche to meet a EUR 1.6 billion payment due to the International Monetary Fund on June 30. The disbursement will be possible only if the Greek parliament approves the proposal and adopts first set of reforms. The offer will also require approval from other eurozone parliaments.

With the Eurogroup meeting in Brussels on Thursday ending without a deal, the euro area finance ministers are now scheduled to hold their next session on Saturday. Eurogroup Chief Jeroen Dijsselbloem said the "door is still open" for Greece.

Meanwhile, in some positive economic news from the U.S., consumer sentiment improved much more than previously expected in June.

The benchmark S&P/TSX Composite Index closed Friday at 14,808.09, down 89.41 points or 0.60 percent. The index scaled an intraday high of 14,886.34 and a low of 14,782.47.

On Thursday, the index closed down 50.01 points or 0.33 percent, at 14,897.50. The index scaled an intraday high of 14,957.24 and a low of 14,861.68.

Crude oil futures ended lower amid mounting concerns over Greece and the health of the global economy, even as the crucial Iran nuclear deal deadline nears with talks continuing in Vienna, Austria.

The Energy Index dropped 1.04 percent, with U.S. crude oil futures for August delivery shedding $0.07 to settle at $59.63 a barrel on the New York Mercantile Exchange Friday.

Among energy stocks, Suncor Energy Inc. (SU.TO) dropped 0.55 percent, while Crescent Point Energy Corp. (CPG.TO) fell 2.64 percent and Encana Corp. (ECA.TO) shed 2.95 percent

Enbridge Inc. (ENB.TO) dropped 0.97 percent, while Cenovus Energy Inc. (CVE.TO) fell $1.42 a share.

Gold futures ended lower on concerns over Greece's continued financial woes with no deal still in sight.

The Gold Index dropped 0.64 percent, with gold for August delivery gaining $1.40 or 0.1 percent, to settle at $1,173.20 an ounce in electronic trade on the New York Mercantile Exchange Friday.

Among gold stocks, Goldcorp Inc. (G.TO) dropped 0.44 percent, Barrick Gold Corp. dropped 1.03 percent, and Kinross Gold Corp. (K.TO) surrendered 1.06 percent. The Capped Materials Index slipped 1.00 percent, as Agrium Inc. (AGU.TO) declined 1.73 percent and Agnico Eagle Mines Limited (AEM.TO) fell 1.53 percent. Franco-Nevada Corp. (FNV.TO) shed 0.22 percent.

Potash Corp. of Saskatchewan (POT.TO) declined 1.83 percent after its offer to acquire German potash maker K+S Group.

The Diversified Metals & Mining Index dropped 0.75 percent, even as First Quantum Minerals Ltd. (FM.TO) dipped 1.04 percent and Teck Resources (TCK.B.TO) fell 0.99 percent.

The heavyweight Financial Index edged down 0.02 percent, as Royal Bank of Canada (RY.TO) edged up 0.15 percent, National Bank of Canada (NA.TO) dipped 0.17 percent, and Bank of Montreal (BMO.TO) gathered 0.21percent.

Toronto-Dominion Bank (TD.TO) gained 0.37 percent, Bank of Nova Scotia (BNS.TO) added 0.17 percent, and Canadian Imperial Bank of Commerce (CM.TO) inched up 0.07 percent.

The Capped Health Care Index fell 1.20 percent as Valeant Pharmaceuticals International, Inc. (VRX.TO) shed 1.94 percent, Extendicare Inc. (EXE.TO) fell 0.66 percent, and Catamaran Corp. (CCT.TO) dipped 0.19 percent.

The Capped Industrials Index dipped 0.57 percent, as Bombardier Inc. (BBD-A.TO) fell 2.43 percent and Finning International Inc. (FTT.TO) fell 0.17 percent.

The Information Technology Index edged down 0.26 percent, as BlackBerry Inc. (BB.TO) fell 1.13 percent, Sierra Wireless, Inc. (SW.TO) dropped 1.99 percent, and Descartes Systems Group Inc. (DSG.TO) gained 0.45 percent.

The Capped Telecommunication Index edged gained 0.04 percent, as TELUS Corp. (T.TO) gained 0.23 percent, BCE Inc. (BCE.TO) fell 0.46 percent, and Manitoba Telecom Services (MBT.TO) dropped 0.11 percent.

Rogers Communication (RCI-B.TO) gained 0.39 percent.

Bank of Montreal (BMO.TO) climbed 0.21 percent, after OneAmerica agreed to acquire BMO's Milwaukee-based, U.S. retirement services business, BMO Retirement Services.

Air Canada (AC.TO) fell 0.79 percent, after announcing that the members of the Canadian trade union Unifor have ratified an agreement on a new collective agreement for five years.

INSCAPE Corp. (INQ.TO) plunged 6.34 percent, after its fourth quarter loss widened to $0.24 per share, from $0.10 per share last year.

Metro Inc. (MRU.TO) dropped 0.23 percent, after announcing its intention to purchase for cancellation up to 450,000 of its Common Shares through private agreements.

On the economic front, consumer sentiment in the U.S. improved more than previously estimated in June, a report from the University of Michigan said Friday. The consumer sentiment index for June was upwardly revised to 96.1 from the mid-month reading of 94.6. Economists expected the index to be unrevised from the preliminary reading, which was already up sharply from the final May reading of 90.7.

France's consumer confidence held steady for the second straight month in June, survey data from the statistical office INSEE showed Friday. The consumer confidence came in at 94 in June, the same reading as in the previous two months. The May figure was revised from 93. Economists had expected the index to remain same at 93.

Germany's import prices dropped at a faster-than-expected pace in May, figures from Destatis showed Friday. Import prices slid 0.8 percent year-over-year in May, faster than previous month's 0.6 percent decrease. Economists had expected a 0.4 percent fall for the month.

The eurocoin indicator, which measures the current economic situation in the euro area, rose for the seventh consecutive month in June, a survey by the Bank of Italy and the Centre for Economic Policy Research showed Friday. The eurocoin indicator increased to 0.39 in June from 0.38 in the previous month. In April, the score was 0.33.

Eurozone banks lending to private sector in May grew at its fastest pace in more than three years, indicating demand for credit has also started to recover with economic growth. Loans to the private sector increased 0.5 percent in May from last year after staying flat in April and gaining 0.1 percent in March, the European Central Bank reported Friday. This was the fastest expansion since early 2012.

At the same time, the overall credit extended to the private sector increased 0.2 percent after remaining unchanged in April. Also, the rate of growth in credit to households accelerated to 0.9 percent.

House prices in England and Wales climbed at the slowest annual pace in seventeen months in May, figures from the Land Registry revealed Friday. The house price index rose 4.6 percent year-on-year following 5.1 percent gain in April. The latest increase was the smallest since December 2013, when prices increased 4.3 percent. House price inflation eased for the ninth successive month in May.