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Canadian Stocks Are Declining As Crude Prices Fall - Canadian Commentary

The Canadian stock market is under pressure Thursday morning, as weakness in the energy sector is weighing on the overall market. Crude oil prices are falling after an industry report showed U.S. oil inventories unexpectedly climbed last week.

Profit taking also seems to be contributing to the weak performance Thursday morning, as the recent upward trend on Bay Street has brought the Canadian market to near record highs.

The majority of the European markets are up slightly Thursday morning, but remain little changed overall. Traders will be keeping a close eye on comments from European Central Bank President Mario Draghi and other ECB members at the IMF's annual meeting in Washington D.C.

Markets in the United States are down slightly in early trade Thursday. Profit taking appears to be a factor, after the major averages ended Wednesday's trading at new record closing highs. Traders will be watching for the release of retail sales and inflation data Friday morning.

The benchmark S&P/TSX Composite Index is down 26.08 points or 0.17 percent at 15,774.32.

On Wednesday, the index closed up 30.04 points or 0.19 percent, at 15,800.40. The index scaled an intraday high of 15,816.82 and a low of 15,784.36.

The Energy Index is falling 1.16 percent. Crude oil futures are down Thursday after an industry report showed U.S. oil inventories unexpectedly climbed last week.

U.S. crude oil stocks rose 3.097 million barrels at the end of last week, the American Petroleum Institute (API) said.

Encana (ECA.TO) is down 0.70 percent and Crescent Point Energy (CPG.TO) is weakening by 1.87 percent. Husky Energy (HSE.TO) is declining 0.57 percent and Canadian Natural Resources (CNQ.TO) is lower by 1.25 percent. Imperial Oil (IMO.TO) is dropping 1.34 percent. Cenovus Energy (CVE.TO) is decreasing 1.15 percent and Suncor Energy (SU.TO) is losing 1.51 percent.

The Capped Healthcare Index is lower by 1.07 percent. Valeant Pharmaceuticals International (VRX.TO) is losing 1.18 percent and Concordia International (CRX.TO) is falling 0.67 percent. ProMetic Life Sciences (PLI.TO) is forfeiting 0.65 percent

The Gold Index is decreasing 0.27 percent. Gold prices have turned positive Thursday morning ahead of a snapshot on U.S. inflation that may influence the course of interest rates.

Goldcorp (G.TO) is weakening by 0.06 percent and B2Gold (BTO.TO) is down 0.73 percent. Eldorado Gold (ELD.TO) is surrendering 0.53 percent.

Barrick Gold (ABX.TO) is down 0.24 percent. The company says it produced 1.24 million ounces of gold in the quarter ended Sept 30, less than the 1.38 million ounces produced a year earlier.

The Capped Materials Index is down 0.14 percent. Agrium (AGU.TO) is decreasing 0.87 percent and Potash Corp. of Saskatchewan (POT.TO) is losing 0.59 percent.

The heavyweight Financial Index is decreasing 0.18 percent. Bank of Montreal (BMO.TO) is down 0.10 percent and Royal Bank of Canada (RY.TO) is weakening by 0.09 percent. National Bank of Canada (NA.TO) is losing 0.24 percent and Bank of Nova Scotia (BNS.TO) is declining 0.51 percent. Canadian Imperial Bank of Commerce (CM.TO) is surrendering 0.23 percent.

The Capped Information Technology Index is losing 0.08 percent. Sierra Wireless (SW.TO) is weakening by 1.10 percent

BlackBerry (BB.TO) is falling 0.35 percent after it has ended its patent dispute with BLU and signed a license deal with the Florida company.

The Capped Industrials Index is up 0.32 percent. Canadian Pacific Railway (CP.TO) is climbing 1.79 percent and Canadian National Railway (CNR.TO) is adding 0.05 percent. Finning International (FTT.TO) is rising 0.31 percent and Air Canada (AC.TO) is increasing 1.36 percent.

WestJet Airlines (WJA.TO) is lower by 0.18 percent after it said its load factor rose last month.

Metro (MRU.TO) is selling off most of its stake in Alimentation Couche-Tard Inc. to help fund the purchase of pharmacy chain Jean Coutu. The stock is rising 0.26 percent.

Jean Coutu (PJC.A.TO) said Revenues increased by 6.1% to $744.3 million for the second quarter, and net profit per share amounted to $0.26. Shares are higher by 0.16 percent.

On the economic front, a report from Statistics Canada this morning showed that the Canadian new housing price index increased by 0.1 percent in August. Economists had expected an increase of 0.3 percent.

Eurozone industrial output expanded at the fastest pace in nine months in August, largely driven by production of capital goods. Industrial production grew by a more-than-expected 1.4 percent month-on-month in August, faster than the 0.3 percent rise seen in July, data from Eurostat showed Thursday.

This was the biggest increase since November 2016, when output grew 1.6 percent. Economists had forecast a monthly 0.6 percent increase.

France's consumer price inflation rose to a five-month high in September, final data from the statistical office Insee showed Thursday. Inflation rose to 1 percent in September, as estimated, from 0.9 percent in August. This was the fastest rate since April, when inflation was 1.2 percent.

House prices in the United Kingdom moved higher again in September, the latest survey from the Royal Institution of Chartered Surveyors showed on Thursday with a house price balance of 6.0 percent. That was unchanged from the August reading, and it beat expectations for a gain of 4.0 percent.

First-time claims for U.S. unemployment benefits fell by more than anticipated in the week ended October 7th, according to a report released by the Labor Department on Thursday. The report said initial jobless claims dropped to 243,000, a decrease of 15,000 from the previous week's revised level of 258,000.

Economists had expected jobless claims to dip to 251,000 from the 260,000 originally reported for the previous week.

Partly reflecting another jump in energy prices, the Labor Department released a report on Thursday showing that U.S. producer prices increased in line with economist estimates in the month of September. The Labor Department said its producer price index for final demand climbed by 0.4 percent in September after edging up by 0.2 percent in August.

In commodities, crude oil futures for November delivery are down 1.00 or 1.95 percent at $50.30 a barrel.

Natural gas for November is up 0.067 or 2.32 percent at $2.956 per million btu.

Gold futures for December are up 4.10 or 0.32 percent at $1,293.00 an ounce.

Silver for December is up 0.032 or 0.19 percent at $17.165 an ounce.

by RTTNews Staff Writer

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