TSX Flat Amid Cautious Trade - Canadian Commentary

(RTTNews) - Canadian stocks were struggling for direction Tuesday morning as traders turned cautious ahead of Federal Reserve Chairman Ben Bernanke's testimony on monetary policy later this week and on continued worries about China's economic growth.

European stocks were trading mostly lower after survey data from the Center for European Economic Research showed German economic sentiment deteriorated unexpectedly in July.

The S&P/TSX Composite Index slipped 3.14 points or 0.02 percent to 12,525.21.

The price of crude oil was ticking lower Tuesday morning amid speculation that US crude oil inventories will dip for the third consecutive week, and on weak US dollar. Recent data from the EIA revealed that US crude oil inventories have fallen more than 20 million barrels over the last two weeks.

Crude for August eased $0.17 to $106.15 a barrel.

In the oil patch, Suncor Energy (SU.TO), Tourmaline Oil (TOU.TO), Bonterra Energy (BNE.TO) and Niko Resources (NKO.TO) were down around 1 percent each, while Baytex Energy Corp. (BTE.TO) rose about 1 percent.

The price of gold was moving higher, with the US dollar moving lower versus a basket of currencies amid the release of inflation data. Gold for August added $9.50 to $1,293.00 an ounce.

Among gold plays, Royal Gold (RGL.TO) gained 4 percent. Barrick Gold (ABX.TO), Agnico-Eagle Mines (AEM.TO) and Goldcorp. (G.TO) gathered around 2 percent each.

Coeur Mining Inc. (CDM.TO) gained over 5 percent after announcing that it produced 4.6 million ounces of silver and 60,757 ounces of gold during the second quarter of 2013. The company also reaffirmed its full-year 2013 consolidated production guidance of 18.0-19.5 million ounces of silver and 250,000-265,000 ounces of gold.

Advanced optoelectronic devices company Zecotek Photonics (ZMS.V) gained about 4 percent after announcing that its wholly owned subsidiary Zecotek Imaging Systems Pte. Ltd. has signed a joint collaboration partnership agreement with Hamamatsu Photonics of Japan to commercialize existing imaging technologies

In economic news Statistics Canada said manufacturing sales increased 0.7 percent to $48.6 billion in May, registering the second gain in five months. Sales were up in 11 of 21 industries, representing about 57 percent of the manufacturing sector. Sales of durable goods were up 1.3 percent while non-durable goods sales edged up 0.2 percent.

From the U.S., the Labor Department said its consumer price index rose by 0.5 percent in June after inching up by 0.1 percent in May. Economists had been expecting prices to increase by 0.4 percent. Excluding food and energy prices, the core consumer price index edged up by 0.2 percent in June, matching the increase seen in the previous month as well as economist estimates.

From the euro zone, German economic sentiment deteriorated unexpectedly in July, survey data from the Center for European Economic Research revealed. The ZEW indicator of economic sentiment fell 2.2 points to 36.3 point-mark, while it was forecast to improve to 40. Nonetheless, it remains above the historical average of 23.7.

Inflation in euro area accelerated to 1.6 percent in June from 1.4 percent in May, the Eurostat said, confirming its flash estimate. Month-on-month, the harmonized index of consumer prices increased 0.1 percent in June.

In a separate report, the Eurostat said eurozone's trade in goods with the rest of the world resulted in a surplus in May, which was higher than a month earlier. The trade surplus rose to EUR 15.2 billion in May from a downwardly revised EUR 14.1 billion in April. A year earlier, the surplus amounted to EUR 6.6 billion.

U.K. inflation rose to 2.9 percent in June on higher motor fuel and clothing and footwear charges, data from the Office for National Statistics showed. It was the fastest since April 2012. Although the rate exceeded the 2.7 percent seen in May, it stayed marginally below the expected rate of 3 percent. Month-on-month, consumer prices fell 0.2 percent, offsetting the 0.2 percent increase in the prior month.