TSX Ends Sharply Lower On Syria Concerns - Canadian Commentary

(RTTNews) - Canadian stocks ended sharply lower for a second straight session Tuesday, with a broad sell-off on fears over possible military intervention by the U.S. and its allies in Syria weighed on investor sentiments towards risky equity assets. All major sub-indices of the main index ended in the red. The downturn came, notwithstanding some upbeat earnings report from two major Canadian banks, the Bank of Nova Scotia and the Bank of Montreal.

The U.S. has accused the Syrian government of trying to cover up the chemical weapons attack in a rebel stronghold near Damascus last week. The Obama administration will be making an informed decision on how to respond after consulting with its allies and the Congress. Secretary of State John Kerry blamed the Assad regime for the attack against civilians, and said the use of chemical weapons was inexcusable and undeniable.

The S&P/TSX Composite Index closed Tuesday at 12,591.21, down 169.09 points or 1.33 percent. The index touched an intraday high of 12,760.30 and a low of 12,567.16.

The Diversified Metals & Mining Index plunged 3.93 percent, with First Quantum Minerals Ltd. (FM.TO) plummeting 5.10 percent. Osisko Mining Corp. (OSK.TO) dropped 2.51 percent, while Teck Resources Limited (TCK.B.TO) shed 2.94 percent. Lundin Mining Corp. (LUN.TO) surrendered 3.97 percent.

The Capped Materials Index plummeted 3.71 percent, with Potash Corporation of Saskatchewan Inc.(POT.TO) dropping 2.27 percent.

Gold futures surged to end at a more than three-week high Tuesday, with investors falling back on the safe haven appeal of the precious metal on concerns over the geopolitical tensions brewing in Syria and worries over the fiscal situation in the U.S. as it approaches its debt ceiling in mid-October, unless the Congress votes to increase it.

The Global Gold Index plunged 4.09 percent, although gold futures for December delivery surged $27.10 or 2 percent to close at $1,420.20 an ounce Tuesday on the Nymex.

Among gold stocks, Kinross Gold Corp. (K.TO) plunged 4.52 percent, while Yamana Gold Inc. (YRI.TO) plummeted 4.96 percent. B2Gold Corp. (BTO.TO) plunged 5.81 percent, while Goldcorp Inc. (G.TO) surrendered 4.62 percent. IAMGOLD Corp. (IMG.TO) slumped 6.28 percent, while Barrick Gold Corp. (ABX.TO) gave up 4.09 percent.

Crude oil prices surged nearly three percent to end at a eighteen-month high Tuesday, on concerns over the geopolitical tensions brewing in Syria with reports of a possible military intervention by the U.S. and its allies, fueling fears the action could disrupt supplies from the Middle East region.

The Energy Index dipped 0.03 percent, although U.S. crude oil futures for October delivery surged $3.09 or 2.9 percent to close at $109.01 a barrel Tuesday on the Nymex.

Among energy stocks, Talisman Energy Inc. (TLM.TO) slipped 0.62 percent, while Encana Corp. (ECA.TO) dropped 1.15 percent. Suncor Energy Inc.(SU.TO) added 0.84 percent, while Surge Energy Inc. (SGY.TO) slipped 1.02 percent.

The Financial Index shed 1.06 percent with Royal Bank of Canada (RY.TO) shedding 0.83 percent. Toronto-Dominion Bank (TD.TO) declined 1.28 percent, while Manulife Financial Corp. (MFC.TO) lost 1.67 percent.

The Bank of Montreal (BMO.TO) gained 0.41 percent after reporting improved net income of C$1.14 billion or C$1.68 per share for the third quarter, compared to C$970 million or C$1.42 per share in the prior-year quarter. Excluding items, adjusted net income for the quarter was C$1.14 billion or C$1.68 per share, compared to C$1.01 billion or C$1.49 per share in the year-ago quarter. Analysts expected earnings of C$1.52 per share for the quarter.

Bank of Nova Scotia (BNS.TO) shed 1.67 percent after reporting lower third-quarter net income of C$1.65 billion or C$1.37 per share compared to C$1.95 billion or C$1.69 per share, a year ago. However, excluding one-time items, net income came in at C$1.39 per share. Analysts expected the bank to report profit per share of C$1.30 for the quarter.

The Information Technology Index surrendered 2.40 percent, although BlackBerry Limited (BB.TO) climbed 0.92 percent.

The Capped Industrials Index declined 1.87 percent, with Bombardier Inc. (BBD.A.TO, BBD.B.TO) down 3.83 percent.

In economic news from the U.S., a report from Standard & Poor's showed the S&P/Case-Shiller 20-City Composite Home Price Index rose by a seasonally adjusted 0.9 percent in June after rising by 1.0 percent in May. Economists had been expecting the index to show another 1.0 percent increase.

Separately, the Conference Board said its consumer confidence index edged up to 81.5 in August from an upwardly revised 81.0 in July. The increase came as a surprise to economists, who had expected the index to dip to 78.0 from the 80.3 originally reported for the previous month.

From the eurozone, German business confidence improved more-than-expected to 107.5 in August, reports said citing survey results from the Ifo Institute. Economists had forecast the index to rise to 107 in August from the originally estimated level of 106.2 in July. Similarly, current assessment among survey participants climbed to 112 from 110.1. It was forecast to rise moderately to 111.