TSX Ends Lower Tracking Global Markets - Canadian Commentary

(RTTNews) - Canadian stocks ended lower Friday, tracking declining global equity markets, on some mixed data from Europe and the U.S. with increasing concerns over growth in emerging markets.

Most Asian markets ended lower overnight, even as American and European markets ended in the red. Global equity markets have been impacted with concerns over slowing economic growth in emerging markets led by China, further aggravated by the U.S. Federal Reserve move to taper its quantitative easing program.

On Wednesday, the Federal Reserve slashed its monthly bond buying program by a further $10 billion to $65 billion. The Fed said growth in economic activity picked up in recent quarters, although labor market indicators were mixed but on balance showed further improvement.

In economic news, personal income in the U.S. came in nearly unchanged in December, although still showed a bigger than expected increase in personal spending for the month. While Chicago-area business activity saw continued growth in the month of January, a report on Friday showed the pace of growth continues to be slow.

Meanwhile, eurozone inflation slowed unexpectedly in January, with added pressure on the central bank to take more actions to avoid the possibility of deflation in the 18-nation bloc. As well from Europe, German retail sales declined unexpectedly in December, casting doubts about the contribution of private consumption to overall economic growth at the end of 2013.

The S&P/TSX Composite Index closed Thursday at 13,694.94, down 40.34 points or 0.29 percent. The index scaled an intraday high of 13,735.28 and a low of 13,598.03.

The Global Gold Index dropped 0.42 percent, with gold futures for April delivery, the most actively traded contract, shedding $2.70 or 1.6 percent to close at $1,239.80 an ounce Friday on the Nymex.

Among gold stocks, Goldcorp Inc. (G.TO) gained 3.19 percent, while Barrick Gold Corp. (ABX.TO) inched up 0.05 percent. Yamana Gold Inc. (YRI.TO) shed 2.34 percent, while Kinross Gold Corp. (K.TO) surrendered 0.58 percent.

The Capped Materials Index dropped 0.32 percent, although Potash Corp. of Saskatchewan Inc. (POT.TO) moved up 0.09 percent.

Crude oil ended lower after the dollar continued to strengthen against a basket of major currencies, making the oil more expensive.

Nonetheless, the Energy Index gained 0.24 percent, with U.S. crude oil futures for March delivery, the most actively traded contract, shedding $0.74 or 0.8 percent to close at $97.49 a barrel Friday on the Nymex.

Among energy stocks, Canadian Natural Resources Limited (CNQ.TO) moved up 1.33 percent, while Suncor Energy Inc. (SU.TO) edged up 0.25 percent. Talisman Energy Inc. (TLM.TO) slipped 0.66 percent, while Encana Corp. (ECA.TO) dropped 0.30 percent.

The Information Technology Index shed 1.04 percent, with smartphone maker BlackBerry Limited (BB.TO) diving 3.56 percent.

The Diversified Metals & Mining Index dropped 1.65 percent, with Teck Resources Limited (TCK.B.TO) dropping 1.51 percent, Lundin Mining Corp. (LUN.TO) down 0.81 percent, and First Quantum Minerals (FM.TO) down 1.77 percent.

The heavyweight Financial Index slid 0.91 percent with Royal Bank of Canada (RY.TO) down 1.13 percent and the Bank of Nova Scotia (BNS.TO) down 1.12 percent. Bank of Montreal (BMO.TO) dived 1.89 percent, Toronto-Dominion Bank (TD.TO) dropped 0.87 percent, and Manulife Financial Corporation (MFC.TO) shed 1.53 percent.

The Capped Industrials Index moved up 1.84 percent, with Bombardier Inc. (BBD.B.TO) ending flat and Air Canada (AC.B.TO) gaining 2.36 percent.

In economic news, a Thomson Reuters and University of Michigan report on Friday showed an upward revision to their consumer sentiment index for January, although the report still showed a drop in sentiment compared to December. The consumer sentiment index for January was upwardly revised to 81.2 from the preliminary reading of 80.4. This is slightly above economists' estimates of 81.0, but still below the final December reading of 82.5.

Personal income in the U.S. came in nearly unchanged in December, although personal spending increased more than expected, a report from the Commerce Department showed Friday. Personal income inched up by less than a tenth of a percent in December after rising by 0.2 percent in November. Economists expects a 0.2 percent increase. Personal spending climbed by 0.4 percent in December following a 0.6 percent increase in November. The growth exceeded economists' estimates for a 0.2 percent uptick.

Meanwhile, the Chicago-area business activity saw continued growth in the month of January, although the pace of growth continued to slow, a report from MNI Indicators showed Friday. The Chicago Business Barometer dropped to 59.6 in January from a revised 60.8 in December, although a reading above 50 indicates continued growth. Economists expected the barometer at a reading of 59.0. The business barometer fell for the third consecutive month following October's jump to the highest reading since March of 2011.

Eurozone inflation dropped for the second month in a row in January, to 0.7 percent from 0.8 percent in December, flash estimates released by Eurostat showed Friday. Economists expected inflation to accelerate to 0.9 percent in January.

German retail sales declined unexpectedly, with retail turnover dropping 2.5 percent in real terms in December from a month ago, reversing November's 0.9 percent rise, provisional results from Destatis showed Friday. Sales were expected to increase by 0.2 percent.