TSX Ends Lower On Mixed U.S. Data -- Canadian Commentary

(RTTNews) - Canadian stocks ended lower for a third straight session Thursday, on some mixed economic data from the U.S. with the nation's gross domestic product contracting, even as initial claims for unemployment benefits dropped more than expected.

The main index was dragged lower by financial stocks after earnings of Canadian Imperial Bank of Commerce fell significantly, hurt mainly by charges pertaining to its Caribbean unit.

Investors weighed some positive economic data from the U.S., with first-time claims for unemployment benefits dropping much more than expected in the week ended May 24, while pending home sales in the U.S. increased for the second consecutive month in April, although less than anticipated.

The S&P/TSX Composite Index closed Thursday at 14,588.95, down 22.01 points or 0.15 percent. The index scaled an intraday high of 14,631.12 and a low of 14,529.09.

On Wednesday, the index ended lower with commodity prices declining on lack of direction, coupled with weakness in global equity markets and Ukraine.

The Financial Index dropped 0.49 percent with the Canadian Imperial Bank of Commerce (CM.TO) shedding 1.37 percent after reporting a second-quarter profit attributable to shareholders of C$317 million or C$0.73 per share, compared with C$860 million or C$2.09 per share a year ago. However, adjusted earnings came in better than expected at C$887 million or C$2.17 per share.

Among other major banks, Bank of Montreal (BMO.TO) dropped 0.40 percent, National Bank of Canada (NA.TO) shed 0.94 percent, Toronto-Dominion Bank (TD.TO) slipped 0.52 percent, and Royal Bank of Canada (RY.TO) surrendered 0.53 percent.

Bank of Nova Scotia (BNS.TO) added 0.45 percent, after indicating on Wednesday it has agreed to sell a part of its minority stake in Canadian asset manager CI Financial Corp.(CIX.TO) in a secondary offering and raise gross proceeds of as much as C$2.62 billion, or $2.41 billion. CI Financial Corp. is up 1.04 percent.

The Capped Healthcare Index gained 0.72 percent with Catamaran Corp. (CCT.TO) up 1.19 percent and Extendicare Inc. (EXE.TO) down 0.27 percent. Valeant Pharmaceuticals International Inc. (VRX.TO) gained 1.39 percent. The drug maker had raised its offer for Allergan Inc. (AGN) by about 21 percent from its prior offer of $48.30 per share in cash.

Crude oil ended higher on a weak dollar, rebounding from a steep fall yesterday, notwithstanding a more than expected increase in U.S. crude oil stockpiles last week.

Earlier today, data released by the U.S. Energy Information Administration showed U.S. crude oil inventories to have risen 1.7 million barrels in the week ended May 23, while analysts expected an increase of 1.0 million barrels.

The Energy Index added 0.20 percent, with U.S. crude oil futures for July delivery, the most actively traded contract, gaining $0.86 or 0.8 percent to close at $103.58 a barrel Thursday on the Nymex.

Among other energy stocks, Encana Corp. (ECA.TO) gained 1.24 percent, while Canadian Oil Sands Limited (COS.TO) dropped 0.61 percent. Husky Energy Inc. (HSE.TO) shed 0.19 percent, Canadian Natural Resources Ltd. (CNQ.TO) added 0.77 percent, Enbridge Inc. (ENB.TO) lost 1.22 percent, Baytex Energy Corp. (BTE.TO) edged up 0.09 percent, and Pacific Rubiales Energy Corp. (PRE.TO) added 0.05 percent.

Gold futures ended lower with investors weighing some mixed economic data from the U.S. while tracked rising equity markets.

The Global Gold Index added 0.44 percent, with gold futures for August delivery shedding $2.60 or 0.2 percent to close at $1,257.10 an ounce Thursday on the Nymex.

Among gold stocks, Yamana Gold Inc. (YRI.TO) dropped 0.26 percent, Osisko Mining Corp. (OSK.TO) gained 0.51 percent, Barrick Gold Corp. (ABX.TO) added 0.47 percent, and Agnico Eagle Mines Limited (AEM.TO) shedding 0.19 percent.

The Capped Materials Index inched up 0.02 percent, with Potash Corp. of Saskatchewan Inc. (POT.TO) adding 0.25 percent.

The Diversified Metals & Mining Index shed 0.67 percent, with Lundin Mining Corp. (LUN.TO) up 1.91 percent, First Quantum Minerals Ltd. (FM.TO) down 0.35 percent, and Teck Resources Limited (TCK.B.TO) down 0.16 percent.

The Information Technology Index added 0.70 percent, with BlackBerry Limited (BB.TO) surging 5.56 percent. Constellation Software Inc (CSU.TO) slipped 0.34 percent, Celestica Inc. (CLS.TO) dropped 0.47 percent, and Avigilon Corp. (AVO.TO) jumped 5.10 percent.

Descartes Systems Group (DSG.TO) dropped 1.99 percent, despite reporting a first-quarter profit of $3.7 million, up 32 percent from $2.8 million in the same quarter last year. Earnings per share was $0.06, up 50% from $0.04 last year.

The Capped Industrials Index edged up 0.02 percent, with Bombardier Inc. (BBD.B.TO) up 0.27 percent and Air Canada (AC.B) adding 3.30 percent.

In corporate news, Rio Alto Mining Ltd (RIO.TO) dropped 2.22 percent after agreeing to buy 26.97 million common shares of Sulliden Gold Corp. Ltd. (SUE.TO), representing 8.6 percent of Sulliden's basic shares outstanding, from Agnico Eagle Mines Ltd (AEM.TO) for C$1.10 per share for about C$29.7 million in cash. Sulliden Gold Corp. shed 1.03 percent.

In economic news, revised government figures showed the U.S. economy to have contracted by 1% in the first quarter, registering its biggest decline in three years. Economists expected revised figures to show a contraction of about 0.6 percent.

A Labor Department report showed jobless claims in the U.S. to have declined to 300,000 in the week ended May 24, down 27,000 from the previous week. Economists expected jobless claims to dip to 317,000 from the 326,000 originally reported for the previous week.

Meanwhile, personal consumption expenditure in the U.S. rose 3.1 percent in the first quarter, up from 3.0 percent in the previous quarter.

Data from the National Association of Realtors on Thursday showed pending home sales in U.S. rose for the second consecutive month in April, although the rise was by a less than expected 0.4 percent to 97.8. In March, pending home sales had jumped 3.4 percent.

From Asia, retail sales in Japan contracted 4.4 percent on year in April, the Ministry of Economy, Trade and Industry said on Thursday - coming in at 11.011 trillion yen. That was shy of expectations for a contraction of 3.3 percent following the 11.0 percent spike in the previous month.