Canadian Stocks Continue To Weaken As Crude Prices Fall-- Canadian Commentary

(RTTNews) - The Canadian stock market is trading solidly to the downside Friday morning, extending the losses of the previous two sessions. The only sectors trading in the green this morning are tied to gold stocks, which are rising ahead of next weeks' Federal Reserve meeting.

Energy stocks are under pressure after crude oil prices have slipped back below $50 a barrel. Weakness has emerged in the energy sector amid speculation that oil's poor fundamentals will keep prices in check for now.

Data from Statistics Canada showed that employment rose by 14,000 jobs in May, higher than expectations for an increase of 1,800 jobs. In April, the economy shed 2,100 jobs.

With fewer people searching for work, the unemployment rate declined 0.2 percentage points to 6.9 percent, the lowest rate since July 2015. Economists were expecting the jobless rate to rise to 7.2 percent.

Markets in Europe are trading solidly in negative territory Friday, extending their losses from the previous two sessions. Sovereign debt yields in Germany continue to fall due to trepidation ahead of next week's Federal Reserve meeting as well as Britain's referendum later this month on whether to stay in the European Union.

Markets in the United States are also down in early trade Friday, extending yesterday's modest pullback. Trading activity is somewhat subdued as traders look ahead to the Fed's monetary policy announcement next week. Recent economic data suggests the Fed is likely to leave interest rates unchanged, but traders are likely to pay close attention to the accompanying statement.

The benchmark S&P/TSX Composite Index is down 105 points or 0.74 percent at 14,135.02.

On Thursday, the index closed down 73.08 points or 0.51 percent, at 14,240.02. The index scaled an intraday high of 14,270.48 and a low of 14,203.37.

The Diversified Metal and Mining Index is declining 2.11 percent. First Quantum Minerals (FM.TO) is falling 3.81 percent and HudBay Minerals (HBM.TO) is decreasing 1.27 percent. Lundin Mining (LUN.TO) is weakening by 1.38 percent and Capstone Mining (CS.TO) is losing 1.43 percent. Teck Resources (TCK-B.TO) is dropping 2.84 percent and Sherritt International (S.TO) is surrendering 1.22 percent.

The Energy Index is down 2.04 percent. Crude oil prices are falling for a second session Friday, dropping below the key $50 a barrel mark.

Cenovus Energy (CVE.TO) is falling 0.88 percent and Canadian Natural Resources (CNQ.TO) is losing 2.44 percent. Suncor Energy (SU.TO) is declining 1.14 percent and Enbridge (ENB.TO) is slipping 0.65 percent. Crescent Point Energy (CPG.TO) is decreasing 2.14 percent and Husky Energy (HSE.TO) is surrendering 2.11 percent. Encana (ECA.TO) is weakening by 3.62 percent and Imperial Oil (IMO.TO) is down 0.64 percent. The Capped Industrials Index is dropping 1.17 percent. AutoCanada (ACQ.TO) is falling 2.01 percent and Finning International (FTT.TO) is weakening by 2.18 percent. Canadian Pacific Railway (CP.TO) is losing 1.58 percent and Canadian National Railway (CNR.TO) is down 1.35 percent. Air Canada (AC.TO) is surrendering 1.38 percent and Bombardier (BBD-B.TO) is dipping 0.50 percent.

The Capped Healthcare Index is falling 1.20 percent. Concordia Healthcare (CXR.TO) is declining 1.67 percent and Extendicare (EXE.TO) is down 0.38 percent.

Valeant Pharmaceuticals International (VRX.TO) is losing 2.17 percent. Bloomberg reported that the company is considering the sale of Egyptian drug-maker Amoun Pharmaceutical Co. to accelerate its debt-reduction plans.

The heavyweight Financial Index is decreasing 1.06 percent. Canadian Imperial Bank of Commerce (CM.TO) is falling 0.53 percent and National Bank of Canada (NA.TO) is weakening by 1.40 percent. Bank of Nova Scotia (BNS.TO) is declining 1.34 percent and Royal Bank of Canada (RY.TO) is down 1.15 percent. Toronto-Dominion Bank (TD.TO) is losing 0.61 percent and Bank of Montreal (BMO.TO) is surrendering 0.62 percent.

The Capped Information Technology Index is falling 1.04 percent. Constellation Software (CSU.TO) is down 1.22 percent and Avigilon (AVO.TO) is losing 1.00 percent. Sierra Wireless (SW.TO) is decreasing 2.32 percent and BlackBerry (BB.TO) is declining 1.50 percent. Descartes Systems Group (DSG.TO) is also lower by 0.73 percent.

The Capped Telecommunication Services Index is down 0.49 percent. Rogers Communication (RCI-B.TO) is falling 0.68 percent and TELUS (T.TO) is losing 0.17 percent. BCE (BCE.TO) is decreasing 0.48 percent and Manitoba Telecom Services (MBT.TO) is lower by 0.66 percent.

The Gold Index is climbing 1.48 percent. Gold prices are slightly higher this morning, as investors await next week's Federal Reserve interest rate decision.

Barrick Gold (ABX.TO) is rising 3.45 percent and B2Gold (BTO.TO) is higher by 1.86 percent. Yamana Gold (YRI.TO) is increasing 0.45 percent and IAMGOLD (IMG.TO) is climbing 2.59 percent. Goldcorp (G.TO) is advancing 0.84 percent and Royal Gold (RGL.TO) is gaining 0.07 percent. Kinross Gold (K.TO) is up 2.22 percent and Eldorado Gold (ELD.TO) is adding 1.54 percent.

The Capped Materials Index is also up 0.81 percent. Agnico Eagle Mines (AEM.TO) is rising 0.51 percent and Franco-Nevada (FNV.TO) is climbing 1.70 percent. Silver Wheaton (SLW.TO) is increasing 1.77 percent and Agrium (AGU.TO) is adding 0.05 percent. Potash Corp. of Saskatchewan (POT.TO) is gaining 1.01 percent.

Transcontinental Inc. (TCL.A.TO) said second quarter revenues increased 1.4%, but adjusted net earnings decreased 12.5%. The stock is falling 10.80 percent.

Calfrac Well Services (CFW.TO) is surging 8.10 percent. Alberta Investment Management Corp. announced that it has entered into a strategic financing relationship with the company.

On the economic front, Germany's inflation remained low as estimated in May, final figures from Destatis showed Friday. Consumer prices gained 0.1 percent on a yearly basis, reversing a 0.1 percent fall in April.

Germany's wholesale prices declined at a slower pace in May, data from Destatis showed Friday. Wholesale prices decreased 2.3 percent in May from last year, slower than the 2.7 percent fall in April. This was the weakest fall in four months.

French industrial production recovered at a faster than expected pace in April, data from the statistical office Insee revealed Friday. Industrial production grew 1.2 percent on a monthly basis, in contrast to a 0.4 percent decline in March and faster than the expected increase of 0.4 percent. This was the first rise in three months.

U.K. construction output expanded for the first time in four months in April, the Office for National Statistics showed Friday. Construction output grew 2.5 percent on a monthly basis, reversing a 3.6 percent decline in March. It was also faster than the 1.2 percent rise forecast by economists.

In commodities, crude oil futures for July delivery are down 0.81 or 1.60 percent at $49.75 a barrel.

Natural gas for July is down 0.05 or 1.91 percent at $2.567 per million btu.

Gold futures for August are up $6.80 or 0.53 percent at $1,279.50 an ounce.

Silver for July is up $0.077 or 0.45 percent at $17.345 an ounce.