Mining stocks drive TSX lower on weak Chinese data

The Toronto stock market was lower Friday as mining stocks lost ground amid disappointing data from China.The S&P/TSX composite index declined 40.12 points to 13,554.07 as traders also looked ahead to the start of the U.S. fourth quarter earnings season next week.The Canadian dollar rose 0.45 of a cent to 94.14 cents US amid a generally weaker U.S. currency.New York indexes were positive with the Dow Jones industrials ahead 48.94 points to 16,490.29, the Nasdaq climbed 6.18 points to 4,149.25 while the S&P 500 index edged up 4.24 points to 1,836.22.Base metal prices backed off as China’s official nonmanufacturing Purchasing Managers’ Index fell to a four-month low, coming in at 54.6 in December from 56 in November. A reading above 50 indicates expansion.The nonmanufacturing PMI covers services including retail, aviation and software as well as the real estate and construction sectors.North American markets got off to a lacklustre start to 2014 trading Thursday amid a slate of data showing manufacturing sectors in China, the U.S. and Canada still expanding but at a slower pace.The base metals sector was down 0.5 per cent as March copper on the New York Mercantile Exchange lost three cents to US$3.35 a pound. Teck Resources (TSX:TCK.B) fell 27 cents to C$27.31.Financials were also a drag as investors also took some profits from a sector that surged more than 20 per cent during 2013. Scotiabank (TSX:BNS) gave back 82 cents to $65.19.Telecoms were also weak with Rogers Communications (TSX:RCI.B) down 38 cents to $47.28.The energy sector lost 0.2 per cent as February crude on the Nymex slipped 23 cents to US$95.21 a barrel on top of a $3 slide Thursday. Imperial Oil (TSX:IMO) shed 29 cents to C$46.33.February bullion gained $4.70 to US$1,229.90 an ounce and the gold sector drifted 0.3 per cent lower. Goldcorp (TSX:G) faded 29 cents to C$23.84.Techs were supportive while Celestica (TSX:CLS) rose 11 cents to $11.12.Meanwhile, traders are increasingly looking to market fundamentals after the U.S. Federal Reserve ended months of speculation last month and announced it would be cutting back on a key area of stimulus, its US$85 billion of monthly bond purchases. Those purchases are credited with supporting a strong rally on stock markets during 2013, including a 30 per cent surge in the S&P 500 to a record high.Now, investors will focus on corporate earnings to see if those advances were justified.The coming week will see earnings reports from heavyweights including resource company Alcoa and financial giants American Express, JPMorgan Chase and Wells Fargo.Bloomberg News says that earnings are expected to rise just 3.7 per cent in the fourth quarter, excluding financial companies.Investors also looked ahead to comments later Friday by U.S. Federal Reserve Chairman Ben Bernanke for indications about the possible pace of further reductions in monetary stimulus.Automakers also released December sales figures for the U.S. Chrysler said its U.S. sales rose six per cent in the final month of the year.Ford’s sales for December in the U.S. rose 1.8 per cent, lower than the 5.9 per cent gain that was expected.Industry analysts expect a total U.S. sales gain of about four per cent in December and an annual gain of around eight per cent.In other corporate news, Boeing machinists will decide Friday whether to accept a contract that would cut some pension and health care benefits in exchange for ensuring that the company’s new 777X airplane is built in Washington state. The offer has fractured the union and drawn unusual pleas from politicians who say the deal is necessary to support the region’s economic future.European bourses were positive amid data showing that European banks are lending less to companies in another sign the continent’s economic upswing remains less than robust.The European Central Bank reported Friday that loans to companies slipped by 3.1 per cent in November from a year earlier. Analysts say some companies are afraid to borrow due to uncertain growth prospects while others are sitting on adequate cash reserves.London’s FTSE 100 rose 0.23 per cent, Frankfurt’s DAX gained 0.35 per cent and the Paris CAC 40 climbed 0.48 per cent.Earlier in Asia, South Korea’s Kospi gave up 1.1 per cent after Hyundai Motor Co. and Kia Motors Corp. said they expect sales growth in 2014 to be their weakest in a decade. Hong Kong’s Hang Seng tumbled 2.3 per cent.Tokyo was closed for the last day of its New Year’s break.

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