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TSX Ends Lower On Commodities - Canadian Commentary

2/13/2013 4:52 PM ET

Canadian stocks settled lower Wednesday, as gold shares dropped on falling commodity prices and on mixed cues from global equity markets. Investors weighed a mixed bag of macroeconomic data from the U.S. and Europe, with U.S. retail sales in January showing a moderate increase, while eurozone industrial production decreased at a slower pace in December .

The S&P/TSX Composite Index closed Wednesday at 12,775.28, down 13.74 points or 0.11 percent. The index touched an intraday high of 12,814.53 and a low of 12,763.44.

The Global Gold Index plummeted 1.64 percent, with gold futures for April delivery shedding $4.50 or 0.3 percent to close at $1,645.10 an ounce Wednesday on the Nymex.

The Capped Materials Index dropped 1.02 percent, with Potash Corporation of Saskatchewan Inc.(POT.TO) up 0.12 percent.

Among gold stocks, Barrick Gold Corp. (ABX.TO) shed 2.55 percent, while Kinross Gold Corp. (K.TO) dropped 1.13 percent. Yamana Gold Inc. (YRI.TO) lost 0.94 percent, while Goldcorp. Inc. (G.TO) shed 0.97 percent.

The Diversified Metals & Mining Index gained 0.20 percent, with Teck Resources Limited (TCK.B.TO) down 0.50 percent, Osisko Mining Corp. (OSK) down 4.21 percent, and First Quantum Minerals Ltd. (FM.TO) was up 0.80 percent.

Data from the EIA revealed that US crude oil inventories edged up 0.60 million barrels, while gasoline stocks shed 0.80 million barrels in the weekended February 08. Analysts expected crude oil stocks to gain 2.2 million barrels and gasoline stocks to add 0.50 million barrels last week.

Earlier today, the International Energy Agency cut its global oil demand projection to 90.7 mbd for 2013, which is 90,000 bd less than forecast last month.

The Energy Index moved up 0.31 percent, although U.S. crude oil futures for March delivery slipped $0.50 or 0.5 percent, to close at $97.01 a barrel Wednesday on the Nymex.

Among energy stocks, Suncor Energy (SU.TO) gained 0.40 percent, Encana Corp. (ECA.TO) slipped 0.31 percent, and Canadian Natural Resources Limited (CNQ.TO) added 0.79 percent.

Talisman Energy Inc.(TLM.TO) added 2.07 percent after reporting a swing to profit in the fourth-quarter, with net income of $376 million or $0.37 per share, compared to a loss of $117 million or $0.11 per share last year. Adjusted loss from operations totaled $107 million or $0.10 per share, compared to a profit of $114 million or $0.11 per share in 2011. Analysts expected earnings of $0.05 per share for the quarter.

The Financial Index moved up 0.24 percent, with TD Bank Group (TD.TO) up 0.18 percent, Bank of Nova Scotia (BNS.TO) was up 0.41 percent, and Bank of Montreal (BMO.TO) gained 0.24 percent. Royal Bank of Canada (RY.TO) gathered 0.59 percent, while insurance service provider Manulife Financial Corp. (MFC.TO) slipped 1.23 percent.

The Information Technology Index plunged 3.48 percent, as BlackBerry Inc. (BB.TO) shares plummeted 8.20 percent.

The Capped Industrials Index edged up 0.07 percent with transportation systems maker Bombardier Inc. (BBD.A.TO, BBD.B.TO) down 0.49 percent.

Legacy Oil + Gas Inc. (LEG.TO) jumped 4.48 percent after announcing its 2012 year-end reserves and providing an operational update.

Fully integrated developer and manufacturer of immune therapeutics Cangene Corp (CNJ.TO) rose 3.09 percent after announcing that it received FDA Advisory Committee support for Botulism Antitoxin product and seeking licensure for the product for the treatment of symptomatic botulism.

Precious metals miner Coeur d'Alene Mines Corp. (CDE, CDM.TO) plunged 10.32 percent after confirming the submission of a binding proposal to acquire all of the issued and outstanding common shares of Orko Silver Corp. (OK.V) in a transaction aggregating about C$384 million. Meanwhile, shares of Orko Silver skyrocketed about 18 percent.

Aviation-training and simulation products provider CAE, Inc. (CAE.TO) shed 1.95 percent after posting lower third-quarter net income of C$37.8 million or C$0.15 per share compared with the prior year's C$45.6 million or C$0.18 per share. However, excluding $8.8 million after-tax of restructuring, integration and acquisition costs, net income was C$46.6 million or C$0.18 per share this quarter. Analysts expected earnings per share of C$0.17 for the quarter.

Metals distribution & processing company Russel Metals (RUS.TO) Tuesday reported fourth-quarter earnings of C$20.4 million or C$0.34 per share, down from C$28.5 million or C$0.46 per share last year. Analysts estimated earnings of C$0.39 per share. The stock was up 0.34 percent.

In economic news from the U.S., the Commerce Department said that retail sales crept up by 0.1 percent in January following a 0.5 percent increase in December. The modest increase in sales matched economist estimates. Excluding a 0.1 percent drop in sales by motor vehicle and parts dealers, retail sales rose by 0.2 percent in January compared to a 0.3 percent increase in December.

Separately, the U.S. Commerce Department said business inventories inched up moderately by 0.1 percent in December following a 0.2 percent increase in November. Economists expected inventories to increase by 0.3 percent.

The U.S. Labor Department in a report said import prices in the country increased less than anticipated in January, with Import prices rising 0.6 percent in January following a revised 0.5 percent decrease in December. Economists expected import prices to increase 0.8 percent compared to the 0.1 percent drop originally reported for the previous month. Export prices rose by 0.3 percent in January, in line with economists' estimates. The increase in export prices followed a 0.1 percent dip in December.

Elsewhere, eurozone industrial production decreased at a slower pace in December, but the rate of fall exceeded economists' forecast, latest data showed. Industrial production decreased 2.4 percent on an annual basis in December, following the previous month's 4 percent fall, Eurostat said. Economists had forecast a more modest decline of 2.3 percent for the month.

Germany's wholesale price inflation eased to its lowest level in six months in January, data from the Federal Statistical Office showed. The wholesale price index rose 2.3 percent year-on-year in January, slower than a 3.2 percent rise in December. Economists expected the rate of inflation to slow to 2.2 percent.

Elsewhere in Europe, the Bank of England lifted its inflation forecast despite subdued real pay growth, citing weakness in sterling and higher tuition fees. The bank also expressed readiness to provide more stimulus if needed to underpin recovery that is set to be slow. Inflation is likely to increase further and stay above the 2 percent target for the next two years, the bank said in its quarterly Inflation Report published Wednesday. Economists had forecast a more modest decline of 2.3 percent for the month.

Germany's wholesale price inflation eased to its lowest level in six months in January, data from the Federal Statistical Office showed. The wholesale price index rose 2.3 percent year-on-year in January, slower than a 3.2 percent rise in December. Economists expected the rate of inflation to slow to 2.2 percent.

Elsewhere in Europe, the Bank of England lifted its inflation forecast despite subdued real pay growth, citing weakness in sterling and higher tuition fees. The bank also expressed readiness to provide more stimulus if needed to underpin recovery that is set to be slow. Inflation is likely to increase further and stay above the 2 percent target for the next two years, the bank said in its quarterly Inflation Report published Wednesday.

by RTT Staff Writer

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