TSX Settles Lower On Soft Data - Canadian Commentary

(RTTNews) - Canadian stocks snapped a four-day gain to end lower Friday, on some soft macroeconomic data out of the U.S. with producer price index rising, giving way to inflation concerns. The euphoria over the U.S. Federal Reserve's assurance on its monetary stimulus policy faded with worries over China's economic growth, after its finance minister cautioned the economy will likely grow at a slower pace than the official growth target for the year.

The S&P/TSX Composite Index closed Friday at 12,462.17, down 31.09 points or 0.25 percent. The index touched an intraday high of 12,519.65 and a low of 12,436.76. The index had gained over 350 points or near 3 percent in the last four sessions.

The Global Gold Index shed 2.50 percent, with gold futures for August delivery dropping $2.30 or 0.2 percent to close at $1,277.60 an ounce Friday on the Nymex.

Among gold stocks, Yamana Gold Inc. (YRI.TO) shed 2.43 percent, while Goldcorp Inc. (G.TO) dropped 1.76 percent. IAMGOLD Corp. (IMG.TO) slipped 1.53 percent, while Barrick Gold Corp. (ABX.TO) surrendered 2.27 percent. Kinross Gold Corp. (K.TO) dived 1.95 percent, while B2Gold Corp. (BTO.TO) lost 1.14 percent.

Alamos Gold Inc. (AGI.TO) dived 3.66 percent after indicating it would acquire Esperanza Resources Corp. (EPZ.V) by way of a court-approved plan of arrangement for C$0.85 in cash for each common share of Esperanza. Shares of Esperanza skyrocketed about 35 percent.

The Capped Materials Index slumped 1.73 percent, with Potash Corporation of Saskatchewan Inc.(POT.TO) down 0.77 percent.

The Diversified Metals & Mining Index dropped 1.94 percent, with First Quantum Minerals Ltd. (FM.TO) down 3.90 percent and Teck Resources Limited (TCK.B.TO) slipped 1.97 percent. Lundin Mining Corp. (LUN.TO) dropped 1.01 percent, while Osisko Mining Corp. (OSK.TO) shed 1.76 percent.

Oil prices ended sharply higher following the Federal Reserve's assurance on its monetary stimulus support and on some upbeat earnings from the U.S. financial sector that lifted hopes of higher energy demand with continued economic recovery.

The Energy Index shed 0.45 percent, although U.S. crude oil futures for August delivery jumped $1.04 or 1 percent to close at $105.95 a barrel Friday on the Nymex.

Among energy stocks, Suncor Energy Inc. (SU.TO) lost 1.61 percent, while Enbridge Inc. (ENB.TO) added 0.57 percent. Talisman Energy Inc. (TLM.TO) dropped 0.67 percent, while Encana Corp. (ECA.TO) shed 1.87 percent. Canadian Natural Resources Limited (CNQ.TO) surrendered 0.54 percent.

The Financial Index ended flat with Manulife Financial Corporation (MFC.TO) down 0.33 percent and Bank of Montreal (BMO.TO) up 0.06 percent. Royal Bank of Canada (RY.TO) moved up 0.29 percent, while Toronto-Dominion Bank added 0.01 percent.

Bank of Nova Scotia (BNS.TO) edged up 0.19 percent after the withdrawal of its application made in September 2011 to buy 19.99 percent stake in Bank of Guangzhou.

The Information Technology Index lost 0.69 percent, with BlackBerry (BB.TO) surrendering 1.03 percent.

The Capped Industrials Index added 0.52 percent, with Bombardier Inc. (BBD.A.TO, BBD.B.TO) ending flat at $4.91.

Bio pharmaceutical company Medicago Inc. (MDG.TO) gained 21.05 percent after announcing its acquisition by Mitsubishi Tanabe Pharma Corp. or MTPC for C$1.16 cash per share.

Specialty and packaging papers company Domtar Corp. (UFS.TO) lost 2.18 percent after announcing that it expects second-quarter sales to be $1.312 billion and estimates an operating loss between $30 million and $35 million.

In economic news from the U.S., the Labor Department's producer price index rose 0.8 percent in June following a 0.5 percent increase in May. Economists expected the growth to match the increase seen in the previous month. Excluding food and energy prices, core producer prices edged up by 0.2 percent in June after inching up by 0.1 percent in May. The increase in core prices matched economist estimates.

Meanwhile, according to a report released by Thomson Reuters and the University of Michigan Consumer sentiment in the U.S. has seen a modest deterioration in the month of July, with the index dipping to 83.9 in July from the final June reading of 84.1. Economists expected the index to remain unchanged compared to the previous month.

Elsewhere, eurozone industrial production declined 0.3 percent month-on-month in May, in line with expectations, reversing April's 0.5 percent rise, data from Eurostat showed. The decline was driven by a 1.5 percent fall in capital goods output and 2.3 percent decrease in durable consumer goods. On a yearly basis, industrial production slipped 1.3 percent, more than double the 0.6 percent drop seen in April. The annual rate of decline matched economists' expectations.