Canadian market fade following poor GDP data

Canada's main stock market in Toronto ended Friday slightly down to snap six straight sessions of gains as Statistics Canada revealed that gross domestic product (GDP) fell 0.3 percent in October.

The Toronto Stock Exchange's benchmark Standard & Poor's/TSX Composite 7.08 points, or 0.05 percent, to enter the Christmas break at 15,328.15 points. Four of the ten sub-sectors lost ground on the day.

On Friday morning, the nation's statistics agency reported that GDP fell for the first time in four months. The 0.3 percent dip in October fell below the market's expectation of no change during the month.

By group, the service-producing industries remained afloat with a 0.1 percent gain in October. Real estate, which accounts for the largest weight in the service group was up 0.4 percent.

Conversely, the goods-producing industries fell 1.3 percent, with manufacturing (2.0 percent decline), and mining (1.2 percent decline) contributing the most.

In addition to releasing the October figure, the September GDP figure was revised up by 0.1 percent to 0.4 percent.

Brian DePratto, Senior Economist at TD Bank believes that even with the decline in October, the economy is trending positively.

"While today's report does provide a soft start to the fourth quarter, the strong September figures help offset this somewhat - we continue to expect above-trend GDP, indicative of an economy that continues to move in the right direction, albeit slowly," DePratto said in a report.

Similar to the conclusion reached from yesterday's poor inflation figure, DePratto believes that today's GDP data will not prompt the central bank to change overnight borrowing rate in the immediate future.

"From the Bank of Canada's perspective, today's report is likely in line with expectations. Per the October Monetary Policy Report, a more moderate pace of growth was expected going forward after last quarter's healthy rebound," DePratto added. "While the risks to monetary policy remain skewed towards further easing, the October GDP numbers are consistent with the Bank of Canada maintaining its policy interest rate at 0.50 percent for the foreseeable future."

Friday's trading session was relatively quiet, as no group saw more than one percent change.

Materials and Health Care groups saw the largest gains, rising 0.95 percent and 0.56 percent, respectively.

Materials group, which consists of producers of gold, precious metals and raw materials, was up as spot price of gold climbed 3.20 U.S. dollars to 1133.40 U.S. dollars an ounce. Shares of Barrick Gold Corporation, the world's largest gold producer, rose 3.41 percent to 19.69 Canadian dollars (14.55 U.S. dollars).

Gold miners IAMGOLD Corporation and OceanaGold Corporation also saw uplifts of 3.64 percent and 3.54 percent, respectively.

Other groups to finish in the green included Telecommunications (0.23 percent), Industrials (0.22 percent), Information Technology (0.13 percent), and Consumer Discretionary (0.07 percent).

Information Technology's uptick was helped by a pair of deals from group members. CGI Group Inc., a Montreal-based IT firm announced the renewal of a deal with iA Financial Group worth 150 million Canadian dollars (about 111 million U.S. dollars) over 10 years. Shares of CGI moved up 0.95 percent to 63.73 Canadian dollars (47.10 U.S. dollars).

Waterloo-based logistics firm Descartes Systems Group announced the acquisition of Miami-based Datamyne for 52.7 million U.S. dollars. The deal will give Descartes access to Datamyne's network which consists of nearly 3000 customers primarily operating in the United States and South America. Descartes stock price finished the day at 28.57 Canadian dollars (21.12 U.S. dollars), a 1.85 percent gain.

The six groups to finish ahead were unable to offset the losses from Energy (0.69 percent), Financials (0.20 percent), and Consumer Staples (0.08 percent).

Shares of Calgary-based energy firms Baytex Energy Corp. and Encana Corporation saw respective declines of 1.36 percent and 0.69 percent, despite February Brent crude oil price climbing 37 cents to 55.08 U.S. dollars a barrel.

The Canadian dollar slipped for a third straight session, falling 0.0019 to 0.7391 U.S. dollars. Endite