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Canadian Stocks Has Reversed Early Losses - Canadian Commentary

The Canadian stock market got off to a weak start Thursday, but has since pared its early losses and has climbed into positive territory. Following yesterday's sharp sell-off, the market is attempting to recover some ground. Bargain hunting appears to be playing a role in the rebound, as well as the early gains on Wall Street.

Markets in Europe are trading in the red Thursday, extending the losses from the previous session. The continued weakness is due to concerns over the mounting troubles for the Trump administration and how they will impact their ability to implement his pro-business policy agenda.

Markets in the United States are attempting to recover some ground in early trade Thursday, following yesterday's sell-off. Former FBI Director Robert Mueller has been appointed to serve as Special Counsel to oversee the investigation of Russian meddling in the presidential election. The move comes on the heels of reports Trump asked former FBI Director Comey to drop a federal investigation into links between former National Security Adviser Michael Flynn and Russia.

The benchmark S&P/TSX Composite Index is up 51.54 points or 0.34 percent at 15,325.22.

On Wednesday, the index closed down 269.65 points or 1.73 percent, at 15,273.68. The index scaled an intraday high of 15,501.58 and a low of 15,273.68.

The heavyweight Financial Index is increasing 0.63 percent. Bank of Nova Scotia (BNS.TO) is gaining 0.28 percent and Bank of Montreal (BMO.TO) is advancing 1.03 percent. Royal Bank of Canada (RY.TO) is rising 1.20 percent and National Bank of Canada (NA.TO) is up 0.93 percent. Toronto-Dominion Bank (TD.TO) is climbing 0.63 percent and Canadian Imperial Bank of Commerce (CM.TO) is higher by 0.39 percent.

The Capped Information Technology Index is gaining 0.58 percent. BlackBerry (BB.TO) is up 1.02 percent and Constellation Software (CSU.TO) is climbing 2.42 percent. Descartes Systems Group (DSG.TO) is up 0.03 percent.

The Capped Healthcare Index is higher by 0.33 percent. Valeant Pharmaceuticals International (VRX.TO) is climbing 1.38 percent and Concordia International (CXR.TO) is gaining 3.49 percent.

The Capped Industrials Index is up 0.29 percent. Canadian National Railway (CNR.TO) is gaining 0.88 percent and Canadian Pacific Railway (CP.TO) is rising 0.05 percent. Air Canada (AC.TO) is increasing 2.68 percent.

The Energy Index is rising 0.73 percent. Crude oil futures are slightly lower Thursday morning amid renewed demand concerns in the wake of President Donald Trump's recent problems.

Imperial Oil (IMO.TO) is up 0.93 percent and Canadian Natural Resources (CNQ.TO) is gaining 0.82 percent. Husky Energy (HSE.TO) is rising 1 percent and Crescent Point Energy (CPG.TO) is advancing 1.45 percent. Encana (ECA.TO) is increasing 0.74 percent and Suncor Energy (SU.TO) is climbing 1.08 percent.
The Capped Telecommunication Services Index is up 0.47 percent. Rogers Communications (RCI-B.TO) is increasing 0.70 percent and BCE (BCE.TO) is rising 0.38 percent. TELUS (T.TO) is also climbing 0.55 percent.

The Gold Index is declining 1.66 percent. Gold prices are down slightly Thursday morning, after logging significant gains in the previous session.

The Capped Materials Index is also down 1.21 percent.

On the economic front, France's unemployment rate based on ILO norms unexpectedly dropped in the first quarter to its lowest level in five years, preliminary data from INSEE showed Thursday. The ILO unemployment rate fell to 9.6 percent from 10 percent in each of the previous three quarters. Economists had expected the figure to hold steady.

UK retail sales recovered at a faster than expected pace in April, figures from the Office for National Statistics showed Thursday.

Retail sales volume including auto fuel grew 2.3 percent month-on-month, reversing a 1.4 percent drop in March. This was the fastest growth since January 2016, and above the expected rate of 1.1 percent. Economists had forecast a moderate 1 percent expansion.

In an upbeat sign for the labor market, the Labor Department released a report on Thursday showing another unexpected drop in first-time claims for U.S. unemployment benefits in the week ended May 13th. The report said initial jobless claims edged down to 232,000, a decrease of 4,000 from the previous week's unrevised level of 236,000. Economists had expected jobless claims to rise to 240,000.

Philadelphia-area manufacturing activity has unexpectedly expanded at a faster pace in the month of May, according to a report released by the Federal Reserve Bank of Philadelphia on Thursday. The Philly Fed said its index for current manufacturing activity in the region climbed to 38.8 in May from 22.0 in April, with a positive reading indicating growth. The index had been expected to dip to 19.5.

In commodities, crude oil futures for June delivery are down 0.16 or 0.33 percent at $48.91 a barrel.

Natural gas for June is up 0.002 or 0.06 percent at $3.194 per million btu.

Gold futures for June are down $7.00 or 0.56 percent at $1,251.70 an ounce.

Silver for July is down $0.286 or 1.69 percent at $16.62 an ounce.

by RTTNews Staff Writer

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