TSX Ends Lower On Soft U.S. Data, BlackBerry -- Canadian Commentary

(RTTNews) - Canadian stocks ended lower for a fifth straight session on Thursday, after some soft economic data from the U.S. with with first time claims for unemployment benefits jumping to a four-month high and manufacturing activity in the Philadelphia area growing at a notably slower pace in January. Nonetheless, the losses were capped with gold stocks making surge as commodity prices firmed.

The main index was taken lower by declining industrial and information tech stocks with Bombardier shedding over 26 percent and BlackBerry diving 20 percent. Financial stocks were under pressure after some disappointing earnings reports from U.S. banks, Citigroup and Bank of America.

Energy stocks also dropped sharply after crude oil prices once again fell sharply, losing over 4.6 percent on the Nymex.

The U.S. stock market is struggling to find direction after the release of some mixed economic data.

In a potentially troubling sign for the labor market, a Labor Department report on Thursday showed first-time claims for U.S. unemployment benefits to have jumped to a four-month high in the week ended January 10. Separately, a Labor Department report showed U.S. producer prices to have recorded their biggest drop in over three years in December, with energy prices declining substantially.

On the positive side, business activity for New York manufacturers expanded in January, after reporting an unexpected contraction in regional manufacturing activity in the previous month, a Federal Reserve Bank of New York report showed. Nevertheless, manufacturing activity in the Philadelphia area grew at a notably slower pace in January, the Federal Reserve Bank of Philadelphia said earlier today.

Investors were also focused on the European currencies after Switzerland shocked the market this morning, when the Swiss National Bank unexpectedly decided to end the minimum exchange rate of CHF 1.2 per euro. The central bank had introduced the ceiling in September 2011 when the Swiss franc was exceptionally overvalued.

The benchmark S&P/TSX Composite Index closed Thursday at 14,041.82, down 42.61 points or 0.30 percent. The index scaled an intraday high of 14,170.67 and a low of 14,017.17.

On Wednesday, the index shed 102.73 points or 0.72 percent, to close at 14,084.43, tracking sharply declining global equity markets after the World Bank slashed its growth forecast for the global economy, with financial and raw materials stocks taking a plunge.

The Capped Industrials Index dropped 1.42 percent, as Bombardier Inc. (BBD.B.TO) plummeted 25.85 percent after the aircraft maker announced around 1,000 job cuts having decided to halt production of its Learjet 85 business planes due to lack of demand. Bombardier also booked a $1.4 billion in pretax fourth-quarter costs.

The Information Technology Index dived 2.78 percent, with BlackBerry Limited (BB.TO) plummeting 19.57 percent, having surged over 29 percent yesterday. The smartphone maker and Samsung denied reports of being in talks for a deal to enable the Korean electronic giant to acquire BlackBerry.

Among other tech stocks, Sierra Wireless (SW.TO) dived 7.26 percent and Constellation Software (CSU.TO) dropped 0.52 percent.

Crude oil ended sharply lower, surrendering much of the gains made yesterday, with investors focused on the developments in the currency market after the Swiss National Bank preferred to to abandon its currency ceiling. Nonetheless, fears of excess supply persisted after the official weekly oil report from the U.S. Energy Information Administration showed crude stockpiles in the U.S. to have jumped more than expected last week.

The Energy Index fell 1.15 percent, with U.S. crude oil futures for February delivery plunging $2.23 or 4.6 percent to close at $46.25 a barrel on the Nymex Thursday.

Among energy stocks, Legacy Oil + Gas Inc. (LEG.TO) plunged 9.22 percent, after having climbed over 9 percent yesterday. ARC Resources Ltd. (ARX.TO) shed 2.10 percent, Canadian Natural Resources Limited (CNQ.TO) slipped 0.31 percent, Suncor Energy Inc. (SU.TO) fell 1.86 percent, and Canadian Oil Sands Limited (COS.TO) dived 4.02 percent.

Pacific Rubiales Energy Corp. (PRE.TO) jumped 4.51 percent, after having shed over 9 percent yesterday. Encana Corp. (ECA.TO) gained 2.20 percent, Crescent Point Energy (CPG.TO) fell 0.73 percent and Cenovus Energy Inc. (CVE.TO) dropped 1.07 percent.

The Diversified Metals & Mining Index moved up 0.29 percent, as First Quantum Minerals Ltd. (FM.TO) added 2.14 percent, and Lundin Mining Corp. (LUN.TO) slipped 0.96 percent after having plummeted 10.98 percent yesterday.

Teck Resources Limited (TCK.B.TO) fell 1.02 percent, Finning International Inc. (FTT.TO) dropped 1.41 percent, Capstone Mining (CS.TO) dived 4.65 percent, and HudBay Minerals (HBM.TO) added 3.06 percent -- having plunged 11.81 percent yesterday.

The heavyweight Financial Index dived 0.89 percent, as National Bank of Canada (NA.TO) dropped 0.27 percent, Toronto-Dominion Bank (TD.TO) fell 1.25 percent, and Bank of Nova Scotia (BNS.TO) shed 0.50 percent.

Royal Bank of Canada (RY.TO) fell 0.74 percent, while Bank of Montreal (BMO.TO) slipped 0.12 percent. Canadian Imperial Bank of Commerce (CM.TO) dropped 0.61 percent.

Gold futures surged to end sharply higher after investors took to the precious metal following the Swiss National Bank's shock decision to abandon its currency ceiling.

The Global Gold Index jumped 7.42 percent, with gold for February delivery surging $30.30 or 2.5 percent to settle at $1,264.80 on the New York Mercantile Exchange Thursday.

Among gold stocks, Yamana Gold Inc. (YRI.TO) jumped 7.68 percent, Agnico Eagle Mines Limited (AEM.TO) jumped 6.98 percent, and Goldcorp Inc. (G.TO) surged 10.94 percent.

Kinross Gold Corp. (K.TO) jumped 10.79 percent, Eldorado Gold Corp. (ELD.TO) climbed 6.75 percent, Barrick Gold Corp .(ABX.TO) surged 9.75 percent, and Franco-Nevada Corp. (FNV.TO) gathered 6.10 percent.

The Capped Materials Index jumped 3.65 percent, mostly on rising gold stocks, with Potash Corp. of Saskatchewan Inc. (POT.TO) adding 0.77 percent.

The Healthcare Index edged down 0.06 percent, as Valeant Pharmaceuticals International, Inc. (VRX.TO) slipped 1.53 percent and Catamaran Corp. (CCT.TO) fell 0.15 percent. Extendicare Inc. (EXE.TO) gained 1.75 percent, after agreeing to acquire Revera's Home Health business for $83 million.

Centamin (CEE.TO) dropped 1.67 percent, after announcing the appointment of Andrew Pardey as Chief Executive Officer and who will also join the Board as an Executive Director effective February 1.

On the economic front, a report from the Labor Department showed U.S. producer prices to have recorded their biggest drop in over three years in December, with the index for final demand dropping by 0.3 percent in December following a 0.2 percent drop in November. The drop reflected the biggest decline since October 2011, with economists anticipating the index to slide by 0.4 percent.

A report from the Labor Department on Thursday showed first-time claims for U.S. unemployment benefits to have jumped to a four-month high in the week ended January 10. The initial jobless claims climbed to 316,000, an increase of 19,000 from the previous week's revised level of to 297,000. Economists expected jobless claims at 295,000 from the 294,000 originally reported for the previous week.

After reporting an unexpected contraction in regional manufacturing activity in the previous month, the Federal Reserve Bank of New York's report on Thursday showed business activity for New York manufacturers to have expanded in January. The New York Fed's general business conditions index jumped to a positive 10.0 in January from a negative 1.2 in December, with a positive reading indicating growth in regional manufacturing activity. Economists expected the index to climb to a positive 5.0.

Manufacturing activity in the Philadelphia area grew at a notably slower pace in January, a report from the Federal Reserve Bank of Philadelphia showed Thursday. The Philly Fed's diffusion index of current activity tumbled to 6.3 in January from 24.3 in December, hitting its lowest level since last February. Economists expected the index to show a much more modest decrease to 20.0.

Eurozone trade surplus set a new record in November, helped by a marginal growth in exports and stagnant imports, and weaker euro is likely to boost demand for exports going forward. The trade surplus rose to a seasonally adjusted EUR 20 billion from EUR 19.6 billion in October, figures from Eurostat revealed Thursday.

Germany's economy grew the most in three years during 2014 amid record high employment, largely led by domestic demand and investments, and the country recorded a fiscal surplus for the third consecutive year. Gross domestic product grew 1.5 percent, in line with economists' expectations, preliminary data from Destatis showed Thursday. The figure was much better than the modest 0.1 percent growth in 2013.