Canadian Stocks Are Slightly Higher On Gold Strength - Canadian Commentary

( - The Canadian stock market is up slightly in early trade Thursday. Gold stocks are leading the way higher this morning, as investors flee to safe havens. Investors have turned cautious after the tone of yesterday's Federal Reserve statement was not as dovish as some had hoped.

The Fed raised interest rates by a quarter point, as widely expected, and indicated it still expects to hike rates twice in the first half of next year.

Markets in Europe are trading firmly in the red Thursday. Bank of England policymakers unanimously left the key interest rate and asset purchase targets unchanged on Thursday, as expected. Brexit uncertainties have intensified considerably since the previous policy session and they are weighing on UK financial markets and on the near-term growth outlook, the bank said.

Markets on Wall Street are little changed in early trade Thursday. Worries the Federal Reserve plans to continue raising interest rates despite signs of slowing growth is likely to keep any buying interest subdued.

The benchmark S&P/TSX Composite Index is up 57.20 points or 0.40 percent at 14,321.26.

On Wednesday, the index closed down by 152.83 points or 1.06 percent, at 14,264.06. The index scaled an intraday high of 14,552.25 and a low of 14,256.07.

The Gold Index is increasing 4.65 percent. Goldcorp (G.TO) is rising 2.90 percent and Kinross Gold (K.TO) is gaining 3.37 percent. Eldorado Gold (ELD.TO) is climbing 6.10 percent and IAMGOLD (IMG.TO) is advancing 8.79 percent. Yamana Gold (YRI.TO) is up 5.86 percent and B2Gold (BTO.TO) is adding 3.67 percent. Barrick Gold (ABX.TO) is higher by 4.50 percent.

The Capped Materials Index is up 2.75 percent. Franco-Nevada (FNV.TO) is gaining 1.86 percent and Agnico Eagle Mines (AEM.TO) is rising 5.39 percent. Nutrien (NTR.TO) is adding 1.06 percent.

The Energy Index is rising 0.52 percent. Cenovus Energy (CVE.TO) is increasing 0.11 percent and Encana (ECA.TO) is climbing 2.34 percent. Canadian Natural Resources (CNQ.TO) is higher by 0.64 percent and Enbridge (ENB.TO) is advancing 1.58 percent. Imperial Oil (IMO.TO) is adding 1.34 percent and Husky Energy (HSE.TO) is up 0.07 percent.

The Capped Information Technology Index is losing 0.44 percent. Constellation Software (CSU.TO) is weakening 0.30 percent and Descartes Systems Group (DSG.TO) is falling 1.17 percent.

The Capped Telecommunication Services Index is down 0.32 percent. TELUS (T.TO) is losing 0.31 percent and BCE (BCE.TO) is declining 0.23 percent. Rogers Communications (RCI-B.TO) is falling 0.17 percent.

Bombardier (BBD-B.TO) is rising 3.21 percent. Bombardier Transportation and Wiener Lokalbahnen have signed a contract to supply 18 Flexity trams to Vienna, including the FlexCare maintenance management system over 24 years. The contract is valued at approximately 94 million euro or US $107 million.

On the economic front, a report from Statistics Canada this morning showed that Canadian wholesale sales increased by 1.0 percent in October. Economists expected an increase of 0.4 percent.

Eurozone's current account surplus increased in October after declining in the previous month, but was lower than the same month last year. The current account surplus rose to EUR 23 billion from EUR 18 billion in September, figures from the European Central Bank showed on Thursday. In October 2017, the surplus was EUR 35 billion.

UK retail sales rose for the first time in three months in November to surpass economists' expectations, thanks to Black Friday promotions and record online spending, while the long term trend was that of a slowdown, amid the persistent Brexit uncertainties.

Data from the Office for National Statistics showed on Thursday that the volume of retail sales including automotive fuel rose 1.4 percent from October, which was much faster than the 0.3 percent growth economists had predicted.

After reporting a notable decrease in first-time claims for U.S. unemployment benefits in the previous week, the Labor Department released a report on Thursday showing initial jobless claims rebounded in the week ended December 15th.

The report said initial jobless claims rose to 214,000, an increase of 8,000 from the previous week's unrevised level of 206,000. Economists had expected jobless claims to climb to 216,000.

Manufacturing activity in the Philadelphia region continued to grow but remained subdued in the month of December, according to a report released by the Federal Reserve Bank of Philadelphia on Thursday. The report said the diffusion index for current general activity dropped to 9.4 in December after tumbling to 12.9 in November.

While a positive reading still indicates growth in regional manufacturing activity, economists had expected the index to rise to 15.0.

A report released by the Conference Board on Thursday showed a modest increase by leading U.S. economic indicators in the month of November. The Conference Board said its leading economic index rose by 0.2 percent in November after falling by a revised 0.3 percent in October.

Economists had expected the index to come in unchanged compared to the 0.1 percent uptick originally reported for the previous month.

In commodities, crude oil futures for January delivery are down 1.29 or 2.68 percent at $46.88 a barrel.

Natural gas for January is up 0.062 or 1.66 percent at $3.788 per million btu.

Gold futures for February are up 7.90 or 0.63 percent at $1,264.30 an ounce.

Silver for January is up 0.067 or 0.45 percent at $14.885 an ounce.

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