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Canadian Stocks Are Down After GDP Dips Unexpectedly - Canadian Commentary

The Canadian stock market is trading modestly to the downside Friday morning. Traders are in a cautious mood due to uncertainty about trade between the U.S. and China ahead of a highly anticipated meeting between President Donald Trump and Chinese President Xi Jinping. The unexpected dip in Canadian GDP this morning has also contributed to the negative mood.

Data from Statistics Canada showed that GDP dropped 0.1 percent on a seasonally adjusted monthly basis from last month, when it rose 0.1 percent. The rate was forecast to remain unchanged.

On a year-on-year basis, GDP grew 0.5 percent in the third quarter, following a 0.7 percent increase in the second quarter.

The annualized rate of GDP slowed to 2.0 percent from 2.9 percent seen in the second quarter. Economists were looking for a growth of 2.0 percent.

Markets in Europe are turning in a mixed performance Friday, but remain little changed overall.

Markets on Wall Street got off to a weak start Friday, but have since pared their early losses. The markets are currently hovering around the flat line.

The benchmark S&P/TSX Composite Index is down 67.54 points or 0.44 percent at 15,126.50.

On Thursday, the index closed up by 22.79 points or 0.15 percent, at 15,194.04. The index scaled an intraday high of 15,251.18 and a low of 15,138.94.

The Energy Index is falling 1.86 percent. Imperial Oil (IMO.TO) is losing 1.46 percent and Cenovus Energy (CVE.TO) is decreasing 1.64 percent. Canadian Natural Resources (CNQ.TO) is weakening 2 percent and Crescent Point Energy (CPG.TO) is sinking 4.96 percent. Suncor Energy (SU.TO) is declining 0.25 percent and Husky Energy (HSE.TO) is lower by 0.62 percent. Encana (ECA.TO) is surrendering 2.16 percent and Enbridge (ENB.TO) is forfeiting 1.73 percent.

The Gold Index is decreasing 1.28 percent. Goldcorp (G.TO) is weakening 1.76 percent and Barrick Gold (ABX.TO) is falling 1.90 percent. IAMGOLD (IMG.TO) is down 0.98 percent and Yamana Gold (YRI.TO) is declining 0.72 percent. B2Gold (BTO.TO) is surrendering 1.51 percent and Eldorado Gold (ELD.TO) is lower by 2.63 percent.

The Capped Materials Index is down 0.86 percent. Franco-Nevada (FNV.TO) is weakening 0.22 percent and Agnico Eagle Mines (AEM.TO) is falling 1.29 percent. Nutrien (NTR.TO) is losing 0.10 percent.

The heavyweight Financial Index is decreasing 0.37 percent. Bank of Montreal (BMO.TO) is falling 0.70 percent and National Bank of Canada (NA.TO) is dipping 0.17 percent. Toronto-Dominion Bank (TD.TO) is down 0.10 percent and Canadian Imperial Bank of Commerce (CM.TO) is weakening 1.37 percent. Royal Bank of Canada (RY.TO) is declining 0.54 percent and Bank of Nova Scotia (BNS.TO) is surrendering 0.29 percent.

The Capped Industrials Index is up 0.81 percent. Air Canada (AC.TO) is climbing 2.09 percent and WestJet Airlines (WJA.TO) is rising 0.77 percent. Canadian Pacific Railway (CP.TO) is higher by 0.68 percent and Canadian National Railway (CNR.TO) is increasing 1.46 percent. Finning International (FTT.TO) is gaining 0.33 percent and Bombardier (BBD-B.TO) is adding 4.84 percent.

The Capped Information Technology Index is gaining 0.39 percent. Descartes Systems Group (DSG.TO) is climbing 1.12 percent and BlackBerry (BB.TO) is advancing 1.01 percent.

The Capped Telecommunication Services Index is up 0.35 percent. TELUS (T.TO) is gaining 0.21 percent and BCE (BCE.TO) is higher by 0.32 percent. Rogers Communications (RCI-B.TO) is rising 0.97 percent.

BRP Inc.(DOO.TO) is surging 5.57 percent after it reported a 13% jump in third quarter revenue at $1.39 billion, slightly above analyst estimates, as the company benefited from strong demand and favourable currency exchange rates.

On the economic front, a report from Statistics Canada this morning showed that the industrial product price index rose 0.2 percent month-on-month in October, unchanged from the previous month. Economists had forecast a 0.5 percent fall.

The manufacturing sector in China was stagnant in November, the latest survey from the National Bureau of Statistics said on Friday with a manufacturing PMI score of 50.0. That missed expectations for a score of 50.2, which would have been unchanged from the October reading. It's also squarely on the line that separates expansion from contraction.

Eurozone's consumer price growth slowed to its lowest level in three months in November and the core inflation unexpectedly eased, preliminary figures from the Eurostat showed on Friday. The consumer price index rose 2 percent year-on-year following a 2.2 percent increase in October. The slowing was in line with economists' expectations.

Eurozone's unemployment rate remained unchanged at its lowest level in nearly 10 years for a third straight month in October, preliminary figures from the Eurostat showed on Friday. The seasonally adjusted jobless rate was 3.1 percent in October, where it has been since July. Economists had expected the figure to ease slightly to 8 percent.

German retail sales rebounded strongly in October, growing at the fastest pace in nearly one-and-a-half years, as a strong labor market and earnings growth supports spending despite a weaker economy. Retail sales grew 5 year-on-year following a revised 2.8 percent slump in September, preliminary data from the Federal Statistical Office showed on Friday. Economists had expected a gain of 1.4 percent.

France's consumer price inflation slowed more-than-expected in November to its lowest level in seven months, preliminary data from the statistical office INSEE showed on Friday. The consumer price index rose 1.9 percent year-on-year following a 2.2 percent increase in October. Economists had expected 2 percent inflation.

In commodities, crude oil futures for December delivery are down 1.39 or 2.70 percent at $50.06 a barrel.

Natural gas for December is down 0.069 or 1.49 percent at $4.577 per million btu.

Gold futures for December are down 7.60 or 0.62 percent at $1,222.80 an ounce.

Silver for December is down 0.253 or 1.77 percent at $14.02 an ounce.

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