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Canadian Shares Exhibiting Weakness On Growth Worries

The Canadian stock market drifted lower Thursday morning, tracking losses posted by European and U.S. markets amid concerns about trade and slowing growth.

Fears of a recession resurfaced again amid another inversion of the yield curve following the yield on the two-year note dropping below the yield on the ten-yean note.

The benchmark S&P/TSX Composite Index was down 52.47 points, or 0.32%, at 16,256.76 at noon. The index, which touched a high of 16,335.06 early on in the session, touched a low of 16,238.42 later in the morning.

Losses in industrial, healthcare and consumer staples sections dragged the market down. Information technology and telecommunications stocks were weak as well, while materials, consumer discretionary and financial stocks were mixed. Energy stocks found support thanks to higher crude oil prices.

Canadian Imperial Bank of Commerce (CM.TO) gained 2.6% on strong results. The bank reported adjusted net income of $1,415 million for the third quarter of the current financial year, compared to $1,399 million in the year-ago quarter. The bank also announced that its board of directors declared a dividend of C$1.44 per share for the quarter, an increase of four cents from the previous quarter.

In the energy section, Enerplus Corp (ERF.TO), Precision Drilling Corp (PD.TO), MEG Energy (MEG.TO), Encana Corp (ECA.TO), Crescent Point Energy (CPG.TO), Whitecap Resources (WCP.TO) and Canadian Natural Resources (CNQ.TO) gained 1 to 2%.

Among the stocks in the industrial section, SNC-Lavalin Inc (SNC.TO) declined 2%. Aecon Group (ARE.TO), Cae Inc. (CAE.TO), Canadian Pacific Railway (CP.TO), Canadian National Railway (CNR.TO) and Ats Automation (ATA.TO) shed 1 to 1.6%.

Among the stocks in the Healthcare Index, Canopy Growth Corp (WEED.TO) declined more than 3%. Cronos Group (CRON.TO), CannTrust Holdings (TRST.TO), Hexo Corp (HEXO.TO) and Bausch Health Companies (BHC.TO) lost 1.5 to 2.5%.

On the economic front, data released by Statistics Canada a little while ago showed wholesale Sales in Canada increased 0.6% in June, rebounding from a 1.9% decline recorded in May 2019.

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