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TSX Ends Lower With Cyprus In Focus - Canadian Commentary

Canadian stocks ended lower Thursday, tracking rising global equity markets led mostly by financial and resource stocks with the developments in the eurozone in focus. Cyprus struggled to find an alternate plan for the bailout aid package it badly needs, with speculations rife that the beleaguered nation may prefer to quit the bloc rather than accept conditions imposed by international lenders.

As Cypriot politicians continue to ponder over an alternate plan for bailout aid, the European Central Bank indicated it would be forced to suspend emergency funding for the nation's banks on Monday if an alternative program is not in place. The Cypriot parliament had rejected a controversial proposal to tax deposits in Cyprus banks for a bailout package earlier this week.

The S&P/TSX Composite Index closed Thursday at 12,747.87, down 78.68 points or 0.61 percent. The index touched an intraday high of 12,831.15 and a low of 12,747.48.

The Global Gold Index gained 2.20 percent, with gold futures for April delivery, gaining $6.30 or 0.4 percent to close at $1,613.80 an ounce Thursday on the Nymex.

Among gold stocks, Barrick Gold Corp. (ABX.TO) gained 2.43 percent, Kinross Gold Corp. (L.TO) gained 2.09 percent, Yamana Gold Inc. (YRI.TO) moved up 2.71 percent, and Gold Corp. (G.TO) gained 1.94 percent.

The Capped Materials Index gained 0.78 percent, with Potash Corporation of Saskatchewan Inc.(POT.TO) slipping 1.82 percent.

The Diversified Metals & Mining Index shed 1.20 percent, with First Quantum Minerals Ltd. (FM.TO) slipping 1.53 percent and Osisko Mining Corp. (OSK.TO) rising 2.67 percent. Lundin Mining Corp. (LUN.TO) fell 0.87 percent, while Teck Resources Limited (TCK.B.TO) shed 1.97 percent.

The Energy Index dropped 1.07 percent, with U.S. crude oil futures for May delivery plummeting $1.05 or 1.1 percent to close at $92.45 a barrel Thursday on the Nymex.

Among energy stocks, Canadian Natural Resources (CNQ.TO) shed 2.47 percent, while Suncor Energy Inc. (SU.TO) edged down 0.42 percent. Husky Energy Inc. (HSE.TO) shed 0.90 percent, while Encana Corp. (ECA.TO) slipped 2.06 percent.

The Financial Index slipped 0.84 percent, with Bank of Nova Scotia (BNS.TO) down 0.74 percent, Manulife Financial Corp. (MFC.TO) down 1.69 percent, and Bank of Montreal (BMO.TO) surrendered 0.30 percent. Royal Bank of Canada (RY.TO) declined 0.98 percent, while Canadian Imperial Bank Of Commerce (CM.TO) lost as much as 1.36 percent. TD Bank (TD.TO) edged down 0.72 percent.

The Information Technology Index dropped 0.39 percent, with BlackBerry Inc. (BB.TO) edging down 0.06 percent.

The Capped Industrials Index declined 1.60 percent, with Bombardier Inc. (BBD.A.TO, BBD.B.TO) down 1.65 percent.

Automotive supplier Martinrea International (MRE.TO) slipped 0.82 percent, reporting a net loss of C$6.6 million or C$0.08 per share compared to net earnings of C$18.5 million or C$0.22 per share a year ago. Adjusted earnings declined to C$12.6 million or C$0.15 per share from C$19.9 million or C$0.24 per share last year. Analysts expected earnings of C$0.18 per share for the quarter.

Gold miner Nevsun Resources Ltd. (NSU.TO) rose 1.06 percent after reporting full-year 2012 net income of $145.26 million or $0.73 per share compared to $147.07 million or $0.74 per share last year. Analysts expected earnings of $0.78 per share for the year.

Athletic apparel company lululemon athletica, Inc. (LLL.TO) gathered 1.36 percent after reporting improved fourth quarter net income at $109.38 million or $0.75 per share compared to $73.52 million or $0.51 per share in the year ago quarter. Analysts expected the company to earn $0.74 per share for the quarter.

In economic news, Statistics Canada said retail sales rose 1.0 percent to $38.9 billion in January, with gains reported in 7 of 11 subsectors, representing 52 percent of total retail trade. The increase was led by higher sales at motor vehicle and parts dealers.

In economic news from the U.S., the Labor Department said initial jobless claims edged up to 336,000, an increase of 2,000 from the previous week's revised figure of 334,000. Economists had expected jobless claims to climb to 340,000 from the 332,000 originally reported for the previous week

Separately, the National Association of Realtors said existing home sales rose 0.8 percent to a seasonally adjusted annual rate of 4.98 million in February from an upwardly revised 4.94 million in January. Economists had been expecting existing home sales to climb to an annual rate of 5.01 million from the 4.92 million originally reported for the previous month.

From the eurozone, Germany's private sector output growth eased further from January's 19-month high, reflecting a contraction in manufacturing and slower growth in services, preliminary data from Markit Economics showed. The seasonally adjusted flash composite output index came in at 51 in March, down from 53.3 in February. This was the lowest reading for three months.

The eurozone private sector downturn intensified in March with the rate of contraction accelerating for the second straight month, flash survey results from Markit Economics showed. The composite output index fell unexpectedly to 46.5 in March from 47.9 in February. Economists had forecast a reading of 48.2.

Retail sales in the UK increased more than expected in February, the latest figures from the Office for National Statistics showed. Retail sales volume, including automotive fuel, rose 2.1 percent month-on-month in February. The rate of growth was much stronger than the 0.4 percent increase expected.

Preliminary results of a survey by Markit Economics revealed China's manufacturing sector expanded at a faster pace in March, with the Markit/HSBC Purchasing Managers' Index rising to 51.7 from 50.4 in February. Economists expected the index to rise to 50.8. Readings above 50 indicates expansion of the sector, while readings below 50 suggests contraction.

by RTTNews Staff Writer

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