Canadian Stocks Declining as Miners Dig Hole; Rail Carriers Pull Industrial Shares Lower


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Canadian Stocks are lower all told, although energy stocks have turned higher as crude oil futures reversed course. But Metals and Mining stocks are struggling as gold and base metal prices sag.

Shares of industrial companies also are sharply lower, falling over 2% as a group, with rail carriers Canadian National Railway (CNR, CNR.TO) and Canadian Pacific (CP ,CP.TO) stumbling after Norfolk Southern ( NSC ) last night reduced its Q3 outlook.

A total of 508,000 people received regular Employment Insurance ( EI ) benefits in July, virtually unchanged from the previous month and falling by 34,900 beneficiaries, or 6.4%, over the past year, according to StatisticsCanada.

Also, Bank of Canada Governor Mark Carney is standing by recent comments arguing rising commodity prices are "unambiguously good" for Canada's economy.

In an interview with published yesterday, Carney spoke about the importance of understanding the commodities boom, warning if political leaders "draw the wrong conclusions from it, (they) could do a lot of damage."

Speaking in Alberta earlier this month, Carney took issue with characterizations Canada is suffering from "Dutch disease" - with too much oil production driving up the value of the Canadian dollar against other currencies and hollowing out the manufacturing sector with the energy sector attracting the top talent.

"So 'unambiguously good' - that is not a slogan," Carney said. "It's not something we want to be true."

Here's where the Canadian markets stand today:

- S&P/TSX Composite Index down 51.43 (-0.41%) to 12,384.73.

- S&P/TSX Venture Composite Index down 10.00 (-0.74%) to 1,333.52.

In company news, Nexen Inc. (NXY, NXY.TO) shareholders today voted to approve a proposed $15.1 billion takeover of the Canadian oil and gas producer by Chinese state-owned CNOOC, but the foreign takeover still requires approval by the Canadian government.

Ninety-nine percent of shareholders voted to approve the $27.50 a share offer. Several regulatory hurdles remain, including the Canadian government deciding whether the deal is a "net benefit" to the country. The formal review began Aug. 29 and normally takes 45 days although it can be extended by 30 days or more.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , Commodities
More Headlines for: EI , NSC

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