Canadian Stocks Are Paring Gains As Gold Weakens -- Canadian Commentary

(RTTNews) - The Canadian stock market bounced back nicely in early trade Tuesday, following yesterday's pullback. However, the market has since pared its gains as losses in the gold sector have worsened. Investors continue to exercise caution ahead of the U.S. employment report at the end of the week.

Financial stocks are climbing following a solid quarterly report from Scotiabank, while rising crude oil prices are providing a boost to the energy sector. Crude oil prices seem to have stabilized around $47 a barrel ahead of tomorrow's U.S. crude inventory report.

The majority of the European markets are trading solidly in positive territory Tuesday. The FTSE 100 of the U.K. is bucking the trend, after returning to action following yesterday's bank holiday. Today's gains are being fueled by speculation among investors that the Federal Reserve is likely to hold off on increasing interest rates until after the November election.

Markets in the United States have slipped into negative territory Tuesday morning. Traders appear reluctant to make significant moves ahead to the release of the closely watched monthly jobs report on Friday. The strength of the employment report could have a significant impact on the outlook for interest rates going into the next Federal Reserve meeting in September.

The benchmark S&P/TSX Composite Index is up 32.79 points or 0.22 percent at 14,714.76.

On Monday, the index closed down up 42.09 points or 0.29 percent, at 14,681.97. The index scaled an intraday high of 14,707.87 and a low of 14,616.23.

The Capped Industrials Index is gaining 0.79 percent. Canadian National Railway (CNR.TO) is increasing 0.41 percent and Canadian Pacific Railway (CP.TO) is climbing 0.64 percent. Bombardier (BBD-B.TO) is higher by 0.97 percent and Air Canada (AC.TO) is rising 1.13 percent. AutoCanada (ACQ.TO) is advancing 0.43 percent and Finning International (FTT.TO) is adding 0.25 percent.

The heavyweight Financial Index is increasing 0.56 percent. Canadian Imperial Bank of Commerce (CM.TO) is climbing 0.50 percent and Toronto Dominion Bank (TD.TO) is gaining 0.74 percent. National Bank of Canada (NA.TO) is rising 0.55 percent and Bank of Montreal (BMO.TO) is up 0.39 percent.

Bank of Nova Scotia (BNS.TO) is higher by 1.26 percent after reporting earnings per share of C$1.54, compared to C$1.45 in the same period a year ago. The bank increased quarterly dividend by 2 cents to 74 cents per share, a 6% increase from last year.

The Energy Index is up 0.48 percent. Crude oil prices are slightly higher Tuesday morning ahead of U.S. inventories and the crucial August jobs report.

Crescent Point Energy (CPG.TO) is up 0.44 percent and Cenovus Energy (CVE.TO) is climbing 0.57 percent. Encana (ECA.TO) is advancing 1.08 percent and Suncor Energy (SU.TO) is increasing 0.33 percent. Canadian Natural Resources (CNQ.TO) is rising 0.12 percent and Imperial Oil (IMO.TO) is gaining 0.65 percent.

The Capped Information Technology Index is rising 0.41 percent. Constellation Software (CSU.TO) is increasing 0.22 percent and Sierra Wireless (SW.TO) is gaining 1.78 percent. BlackBerry (BB.TO) is climbing 0.87 percent.

The Capped Healthcare Index is advancing 0.23 percent. Valeant Pharmaceuticals International (VRX.TO) is climbing 0.58 percent.

The Gold Index is lower by 2.01 percent. Gold prices are slightly lower Tuesday morning as markets looked ahead to Friday's all-important August U.S. jobs report.

Barrick Gold (ABX.TO) is losing 2.75 percent and Kinross Gold (K.TO) is falling 1.58 percent. IAMGOLD (IMG.TO) is declining 1.53 percent and Yamana Gold (YRI.TO) is decreasing 2.41 percent. Goldcorp (G.TO) is weakening by 2.54 percent and Eldorado Gold (ELD.TO) is dipping 0.43 percent. B2Gold (BTO.TO) is also down 3.60 percent.

The Capped Materials Index is also down 0.02 percent. Agnico Eagle Mines (AEM.TO) is lower by 1.24 percent and Silver Wheaton (SLW.TO) is declining 1.35 percent.

Agrium (AGU.TO) is surging 7.11 percent and Potash Corp. of Saskatchewan (POT.TO) is also gaining 11.48 percent after Bloomberg reported that the two companies are planning to merge.

The Capped Telecommunication Services Index is down 0.01 percent. BCE (BCE.TO) is falling 0.14 percent and Manitoba Telecom Services (MBT.TO) is lower by 0.26 percent.

Alimentation Couche-Tard (ATD.B.TO) will buy 53 stores in Louisiana, most in the Baton Rouge market, for an undisclosed price. Shares are falling 0.46 percent.

NeuLion (NLN.TO) is dropping 2.52 percent after it announced a partnership with Nokia.

On the economic front, data from Statistics Canada showed that the Canadian industrial price index increased by 0.2 percent in July. Economists had expected a decrease of 0.3 percent.

Eurozone economic confidence deteriorated to a five-month low in August reflecting widespread weakness across sectors, adding to concerns that risks to growth intensified after the Brexit vote.

The economic confidence index fell more-than-expected to 103.5 from 104.5 in July, survey data from the European Commission showed Tuesday. Economists expected a score of 104.1. This was the lowest reading since March, when it was at 103.

Germany's consumer price inflation held steady in August after accelerating in the previous three months, preliminary data from Destatis showed Tuesday. The consumer price index rose 0.4 percent year-on-year, same as in July. Economists had forecast 0.5 percent inflation.

U.K. mortgage approvals declined to the lowest since early 2015, the Bank of England reported Tuesday. The number of mortgage approvals fell to 60,912 in July from 64,152 in June. This was the lowest since January 2015. Economists had forecast approvals to fall to 61,900.

Germany's import prices continued to fall in July but the pace of decline slowed for the third straight month, Destatis reported Tuesday. Import prices decreased 3.8 percent year-on-year in July, slower than the 4.6 percent decline seen in June and the expected fall of 4 percent.

In commodities, crude oil futures for September delivery are up 0.12 or 0.26 percent at $47.10 a barrel.

Natural gas for September is up 0.006 or 0.21 percent at $2.902 per million btu.

Gold futures for December are down $6.50 or 0.49 percent at $1,320.60 an ounce.

Silver for September is down $0.058 or 0.31 percent at $18.71 an ounce.