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Bay Street Rally Loses Steam Near Record Highs -- Canadian Commentary
(RTTNews.com) - Canadian stocks are lower Wednesday morning, with a downward revision in global growth forecast by the World Bank hurting sentiment.
The World Bank today lowered global growth forecast for this year to 2.8 percent due to a weaker than expected pace of recovery in Chinese, Russian and the U.S. economies. The World Bank had earlier projected a growth of 3.5 percent for the global economy.
Weakness in European markets and some profit taking after seven successive days of gains are also dragging down stock prices.
Healthcare, industrial, telecommunications and consumer staples stocks are among the prominent losers. Energy stocks are also lower, while gold stocks are moving up.
The benchmark S&P/TSX Composite Index is down 41.75 points or 0.27 percent at 14,862.63, after touching a high of 14,904.47 earlier. The index is still within striking distance of an all-time high above 15,000 set in 2008.
Healthcare stocks Catamaran Corporation (CCT.TO) and Valeant Pharmaceuticals International, Inc. (VRX.TO) are declining by over 1.5 percent. Extendicare Inc. (EXE.TO) is down marginally.
In the industrial space, Bombardier Inc. (BBD.B.TO), Finning International Inc. (FTT.TO), CAE Inc. (CAE.TO), Stantec Inc. (STN.TO) and WestJet Airlines Ltd. (WJA.TO) are down 1 to 2.2 percent.
Among the stocks in the consumer staples space, The North West Company Inc. (NWC.TO) is down more than 1 percent on reporting a 1.8 percent decline in first quarter net earnings. Metro Inc. (MRU.TO) and Empire Company Limited (EMP.A.TO) are also notably lower.
In the telecom space, Rogers Communications Inc. (RCI.B.TO) and Bell Aliant Inc. (BA.TO) are down 1.6 percent and 2.2 percent, respectively. Telus Corporation (T.TO) is modestly lower.
Among big six banks, Royal Bank of Canada (RY.TO) and Bank of Nova Scotia (BNS.TO) are modestly lower. National Bank of Canada (NA.TO) and Canadian Imperial Bank of Commerce (CM.TO) are up marginally.
In the energy sector, Canadian Natural Resources Limited (CNQ.TO), Cenovus Energy Inc. (CVE.TO), Canadian Oil Sands Limited (COS.TO) and ARC Resources Ltd. (ARX.TO) are down 0.8 to 1.2 percent.
Goldcorp Inc. (G.TO), Barrick Gold Corporation (ABX.TO), Silver Wheaton Corp. (SLW.TO), Franco-Nevada Corporation (FNV.TO), Torrex Gold Resources (TXG.TO) and Yamana Gold Inc. (YRI.TO) are moving up 0.5 to 2 percent. B2Gold Corp. (BTO.TO), Timmins Gold Corp. (TMM.TO) and Detour Gold Corporation (DGC.TO) are climbing 3 to 4 percent, while New Gold Inc. (NGD.TO) is gaining nearly 5.5 percent.
Shares of Aecon Group Inc. (ARE.TO) are moving up 1.3 percent after the company said it has bagged mining contracts worth C$100 million.
Enghouse Systems Ltd. (ESL.TO) is rising nearly 2.5 percent on reporting a 23 percent increase in second quarter revenue.
Genesis Land Development Corp. (GDC.TO) rose sharply in early deals, but has retreated into negative territory subsequently. The company announced a special cash dividend of 12 Canadian cents a share.
Village Farms International Inc. (VFF.TO) is down nearly 1.5 percent. The company has agreed to acquire a unit of Maxim Power Corp. (MXG.TO) for C$4.5 million.
Reitmans (Canada) Ltd. (RET.A.TO) shares are plunging nearly 11 percent after the company reported a wider first-quarter loss.
Mediagrif Interactive Technologies Inc. (MDF.TO) repored fourth-quarter profit of 25 Canadian cents a share, compared to 22 Canadian cents in the corresponding period last year. The stock is currently unchanged from its previous closing price.
In commodities, crude oil prices are up on the back of a report from the U.S. Energy Information Administration that showed a more than expected 2.6 million barrels decline in crude oil stockpiles in the week ended June 6.
Meanwhile, as expected, the OPEC said it would maintain its production target unchanged at 30 million barrels a day.
Crude oil futures for July are up $0.37 or 0.36 percent at $104.72 a barrel
Natural gas is up $0.017 or 0.036 percent at $4.547 per million btu.
Gold futures for August delivery are up $1.80 or 0.14 percent at $1,262.00 an ounce.
Silver for July is up $0.050 or 0.26 percent at $19.218 an ounce. Meanwhile, copper is down $0.005 or 0.17 percent at $3.048 per pound.
On the economic front, the U.S. Treasury is set to release its monthly budgetary report for May at 2 pm ET. The consensus estimate calls for a widening of the budgetary deficit to $139 billion from $106.9 billion in April.
At 1 pm ET, the Treasury will announce the results of its auction of 10-year notes.
In Europe, unemployment in the U.K. decreased more than expected in the three months to April, falling to 6.6 percent, from 7.2 percent in the November - January period.
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