TSX Ends Lower On Global Cues -- Canadian Commentary

(RTTNews) - Canadian stocks ended lower on Wednesday, tracking declining global equity markets after some soft new home sales data from the U.S. Nonetheless, the losses were limited after some upbeat earnings news lifted sentiments.

However, investors remained concerned over the state of the Chinese economy following another contraction in factory activity and worries about the conflict in Ukraine.

The S&P/TSX Composite Index closed Tuesday at 14,533.39, down 22.58 points or 0.16 percent. The index scaled an intraday high of 14,587.09 and a low of 14,533.59.

On Tuesday, the index ended higher on some strong earnings and economic data from the U.S. and Canada, as well on news of a possible merger of Valeant Pharmaceuticals and Botox maker Allergan.

Crude oil ended lower after a weekly oil report from the Energy Information Administration showed crude stockpiles in the U.S. to have risen more than expected last week, and as well impacted on some weak new home sales data from the U.S., declining global equity markets, and the increasing tensions in eastern Ukraine.

The U.S. Energy Information Administration data earlier Wednesday showed U.S. crude oil inventories to have risen by 3.52 million barrels in the week ended April 18, while analysts expected an increase of 2.27 million barrels. Stockpiles for the week aggregated 397.7 million barrels, the highest commercial crude inventories since late August 1982.

However, gasoline stocks dropped by 0.3 million barrels last week, with analysts anticipating a decline of 1.41 million barrels. Inventories of distillate, including heating fuel, rose by 0.60 million barrels, even as analysts predicted a decline of 0.30 million barrels.

The Energy Index gained 0.51 percent, although U.S. crude oil futures for June delivery, dropped $0.31 or 0.3 percent to close at $101.44 a barrel Wednesday on the Nymex.

Among energy stocks, Suncor Energy Inc. (SU.TO) added 2.80 percent, while Encana Corp. (ECA.TO) gained 0.16 percent. Husky Energy Inc. (HSE.TO) shed 0.27 percent, Canadian Oil Sands Limited (COS.TO) gained 0.50 percent, and Canadian Natural Resources Ltd. (CNQ.TO) added 0.85 percent.

The Capped Healthcare Index dropped 1.37 percent with Valeant Pharmaceuticals International, Inc. (VRX.TO) shedding 2.76 percent. Following the Valeant offer, Allergan late Tuesday adopted a one-year stockholder rights plan to give it more time mull over the offer.

Among other healthcare stocks, Extendicare Inc. (EXE.TO) dropped 0.30 percent and Catamaran Corporation (CCT.TO) shed 1.04 percent.

Gold futures ended higher as investors sought the safe haven appeal of the precious metal with rising tensions in Ukraine and some weak U.S. existing home sales data.

The Global Gold Index gained 2.06 percent, with gold futures for June delivery, adding $3.50 or 0.3 percent to close at $1,284.60 an ounce Wednesday on the Nymex.

Barrick Gold Corp. (ABX.TO) gained 1.45 percent, Agnico Eagle Mines Limited (AEM.TO) jumped 3.86 percent, and Yamana Gold Inc. (YRI.TO) edged up 0.82 percent.

Among other gold stocks, Kinross Gold Corp. (K.TO) was up 1.55 percent and Goldcorp Inc. (G.TO) added 0.92 percent.

The Capped Materials Index gained 0.28 percent, with Potash Corp. of Saskatchewan Inc. (POT.TO) down 2.44 percent.

The Financial Index slipped 0.29 percent with the Toronto-Dominion Bank (TD.TO) down 0.39 percent, Royal Bank of Canada (RY.TO) down 0.46 percent, and Bank of Montreal (BMO.TO) down 0.18 percent.

The Diversified Metals & Mining Index dropped 0.26 percent, with Lundin Mining Corp. (LUN.TO) up 0.18 percent, First Quantum Minerals Ltd. (FM.TO) down 0.95 percent, and Teck Resources Limited (TCK.B.TO) up 0.37 percent.

The Information Technology Index gathered 0.78 percent, with BlackBerry Limited (BB.TO) up 0.74 percent.

The Capped Industrials Index added 0.42 percent, with Bombardier Inc. (BBD.B.TO) down 0.50 percent, Air Canada (AC.B) up 4.33 percent, and Canadian Pacific Railway Limited (CP.TO) down 1.23 percent.

In corporate news, Canadian National Railway Company (CNR.TO) dropped 0.30 percent after reporting a better than expected adjusted earnings for first quarter at C$551 million or C$0.66 per share.

Celestica Inc (CLS.TO) added 1.58 percent on reporting earnings of $0.20 per share for the first quarter 2014, compared to $0.06 per share in the first quarter last year. Adjusted earnings came in at $0.26 per share, above the company's guidance of $0.17 to $0.23 per share.

Baytex Energy Corp. (BTE.TO) added 0.47 percent, after announcing the commencement of cash tender offers relating to any and all of the US$365 million current outstanding principal amount of 9.875% Senior Notes due 2017 and US$300 million current outstanding principal amount of 7.50% Senior Notes due 2020 of Aurora USA Oil & Gas, Inc. (AEF.TO,AOG).

In economic news from the U.S., a Commerce Department report showed new home sales in the U.S. plunged 14.5 percent to an annual rate of 384,000 in March from the revised February rate of 449,000. The steep drop came as a surprise to economists, who had expected new home sales to climb to a rate of 455,000 from the 440,000 originally reported for the previous month.

Meanwhile, the flash Markit Economics purchasing managers' index for the United States in April dropped to 55.4 from 55.5 in March. A readings over 50 indicate growth. New orders and exports rose, while employment was a tad weaker but in positive territory. Production in April rose at its fastest pace since March 2011.

Eurozone private sector started the second quarter on a solid footing with activity growth the fastest in nearly three years in April, but firms continued to slash prices, fueling fears that deflationary pressures are intensifying. The Markit Economics purchasing managers composite output index for eurozone rose to 54.0 in April from 53.1 in March, data showed Wednesday. The improvement was unexpected as economists had forecast a drop to 53. The latest reading was the highest since May 2011.