TSX flat as commodity prices rise

The Toronto stock market closed relatively flat Wednesday as key commodity prices moved higher and the European economy showed improvement.

The S&P/TSX composite index pulled back 2.89 points to 12,639.30, after spending much of the session swinging between positive and negative territory.

The Canadian dollar was up 0.14 of a cent at 96.82 cents (U.S.).

The move on the markets came as the European Union proclaimed an end to its longest ever recession. The 17 countries that use the euro saw economic output grow by 0.3 per cent in the second quarter, the EU statistics office reported Wednesday.

It was the first growth recorded since late 2011.

Michael Smedley, a portfolio manager at Morgan, Meighen and Associates, suggested Europe’s improved economic prospects should have a positive effect on the outlook for its economy for the coming months.

“You get a very slight show of confidence that has been absent for so long, the market will tend to feed off that a bit,” he said.

“So you should get a continuation of moderate improvement in the overall economic state in Europe.”

On Wall Street, weak results from retailer Macy’s raised questions about the U.S. economy and how it will fare in the last half of the year.

Macy’s said shoppers’ reluctance to spend was a factor in disappointing earnings for the second quarter. The company also cut its forecast for the year. The Dow fell 113.35 points to 15,337.66, the Nasdaq dropped 15.17 points to 3,669.27 and the S&P 500 slid 8.77 points to 1,685.39. In commodities, the September crude contract reversed late in the session after moving lower for most of the day. The contract settled ahead two cents at $106.85 a barrel. Gold stocks got a boost as December bullion rose $12.90 to close at $1,333.40 an ounce. Iamgold shares rose seven per cent to $6.01, while Goldcorp Inc. increased nearly four per cent to $29.45. September copper increased two cents to $3.34 a pound. Shares of Canada’s biggest wireless companies remained in the spotlight with attention focused on whether U.S. telecom giant Verizon could set up shop in this country. Industry Minister James Moore posted a tersely worded letter on his website on Tuesday in response to criticism from a board member of BCE Inc., the parent company of Bell. “I think Canadians know very well what is at stake and they know dishonest attempts to skew debates via misleading campaigns when they see them,” Moore’s letter said. The TSX telecom sector was down 0.7 per cent with BCE off two cents at $41.78 (Canadian). Shares of Metro Inc. were down 3.7 per cent, or $2.65, to $69.30 unveiling plans to reorganize its Ontario grocery retail network.