TSX Ends Slightly Lower With Focus On China -- Canadian Commentary

(RTTNews) - Canadian stocks snapped a four-day gain to end a tad lower on Monday, tracking declining U.S. equity markets, as investors continued to focus on China's slowing economy and on some disappointing economic news from south of the border.

The Financial Times reported that the Chinese government has decided to abandon attempts to boost the stock market through a large-scale share purchases. Senior regulatory officials told the Financial Times China's leaders feel they mishandled their efforts to rescue the stock market.

The Chinese government resumed large-scale stock buying late in the trading day last Thursday to help the Shanghai Composite Index finish sharply higher, but officials said the government will refrain from further large-scale buying of equities.

Markets in Europe also ended in the red on Monday, due to renewed worries over China's slowing economy. A new round of elections in Greece and the likelihood of a near-term U.S. interest rate hike also weighed on investor sentiment.

Markets in the United States are also under pressure this morning, with the weakness stemming partly from renewed concerns about the Chinese economy after a report from the Financial Times said the government has decided to abandon attempts to boost the stock market through large-scale share purchases

Renewed concerns over China has investors on edge at the start of the new trading week. Traders are also looking ahead to the release of several key economic reports in the coming days, including the monthly jobs report on Friday.

Business activity in the Chicago area unexpectedly grew at a slower rate in the month of August, according to a report from MNI Indicators on Monday.

The benchmark S&P/TSX Composite Index is down 142.07 points or 1.02 percent at 13,723.00.

The benchmark S&P/TSX Composite Index closed Monday at 13,859.12, down 5.95 points or 0.04 percent. The index scaled an intraday high of 13,888.19 and a low of 13,653.87.

On Friday, the index closed up 98.40 points or 0.71 percent, at 13,865.07. The index scaled an intraday high of 13,866.27 and a low of 13,710.09.

The heavyweight Financial Index slipped 0.24 percent, as Bank of Montreal (BMO.TO) dropped 0.14 percent and National Bank of Canada (NA.TO) shed 0.92 percent.

Toronto-Dominion Bank (TD.TO) fell 0.81 percent, Bank of Nova Scotia (BNS.TO) jumped 1.04 percent, and Canadian Imperial Bank of Commerce (CM.TO) added 0.36 percent.

Royal Bank of Canada (RY.TO) declined 0.49 percent. The company announced it has completed the previously-announced sale of its Switzerland-based private banking business to SYZ Group.

Crude oil surged to end a near 9 percent high after government data showed domestic output in the U.S. to have declined significantly, and reports indicated concerns of the Organization of the Petroleum Exporting Countries over the steep fall in prices.

The Energy Index gained 3.10 percent, with U.S. crude oil futures for October delivery, the most actively traded contract, surged $3.98 or 8.8 percent, to settle at $49.20 a barrel on the New York Mercantile Exchange Monday.

Crescent Point Energy Corp. (CPG.TO) surged 10.11 percent, Canadian Natural Resources Limited (CNQ.TO) added 2.92 percent, and Encana Corp. (ECA.TO) gathered 5.36 percent. Suncor Energy Inc. (SU.TO) moved up 1.22 percent.

Canadian Oil Sands (COS.TO) added 5.34 percent. The company announced Sunday that early on August 29, a process fire occurred in the interconnecting piping between the hydrotreating units and environmental units at Syncrude's Mildred Lake upgrader. No injuries were associated with the event and there was no environmental impact.

The Diversified Metals & Mining Index inched up 0.29 percent, as First Quantum Minerals (FM.TO) dropped 2.70 percent, Teck Resources Limited (TCK-B.TO) moved up 0.96 percent, Lundin Mining Corp. (LUN.TO) gained 4.68 percent, and HudBay Minerals Inc. (HBM.TO) surrendered 3.51 percent.

Gold futures ended lower, on investor concerns over the outlook for U.S. interest rates, although the loss was limited with a weakening dollar.

The Gold Index shed 1.68 percent, with gold for December delivery shedding $1.50 or 0.1 percent, to settle at $1,132.50 an ounce on the New York Mercantile Exchange Monday.

Yamana Gold Inc. (YRI.TO) dropped 4.63 percent, while IAMGOLD Corp. (IMG.TO) shed 1.78 percent.

Among other gold stocks, Barrick Gold Corp. (ABX.TO) fell 3.07 percent, and Kinross Gold Corp. (K.TO) dived 3.29 percent. Goldcorp Inc. (G.TO) fell 1.19 percent. Eldorado Gold Corp. (ELD.TO) dropped 3.20 percent.

The Capped Materials Index fell 2.10 percent, as Agnico Eagle Mines Limited (AEM.TO) shed 0.89 percent, Agrium Inc. (AGU.TO) gained 0.35 percent, and Potash Corp. of Saskatchewan Inc. (POT.TO) dropped 0.15 percent.

The Capped Health Care Index fell 0.65 percent as Concordia Healthcare Corp. (CXR.TO) gained 2.11 percent, Extendicare Inc. (EXE.TO) fell 0.38 percent, and Valeant Pharmaceutical International (VRX.TO) dropped 2.26 percent.

The Capped Information Technology Index gathered 2.89 percent, as BlackBerry Limited (BB.TO) moved up 2.67 percent.

Among other tech stocks, Sierra Wireless (SW.TO) fell 2.64 percent, Descartes Systems Group (DSG.TO) added 0.84 percent, and Avigilon Corp. (AVO.TO) shed 2.15 percent.

The Capped Telecommunication Index fell 0.34 percent, as Rogers Communication (RCI-B.TO) dropped 0.64 percent, BCE Inc. (BCE.TO) slipped 0.24 percent, TELUS Corp. (T.TO) slipped 0.37 percent, and Manitoba Telecom Services Inc. (MBT.TO) edged down 0.07 per share.

The Capped Industrials Index shed 0.34 percent, even as Bombardier (BBD.B.TO) gained 3.20 percent and Finning International Inc. (FTT.TO) slipped 0.67 percent.

On the economic front, business activity in the Chicago area unexpectedly grew at a slower rate in August, a report from MNI Indicators on Monday. The Chicago business barometer dipped to 54.4 in August from 54.7 in July. While a reading above 50 indicates growth, economists had expected the index to inch up to 54.9.

China's trade deficit in services widened in July, the State Administration of Foreign Exchange said Monday. The deficit on trade in services increased to $17.6 billion in July from $14.9 billion in June. At the same time, the merchandise trade showed a surplus of $46 billion in July.

Eurozone inflation remained unchanged at a very low level in August as further fall in oil prices curbed its ability to move upward. Inflation came in at 0.2 percent in August, the same rate as seen in July and June, preliminary data from Eurostat showed Monday. It was forecast to ease to 0.1 percent.

Germany's retail sales rebounded in July to grow at the fastest pace in nine months, signaling that consumer spending boosted economic growth at the start of the third quarter. Retail sales advanced 1.4 percent on a monthly basis in July, Destatis reported Monday. This was the fastest growth since October 2014, when sales climbed 1.8 percent.