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Loonie slightly ahead amid positive U.S. retail sales figures for April

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(Globalpost/GlobalPost)

TORONTO - The Canadian dollar was slightly ahead Monday amid slightly better-than-expected retail figures out of the U.S.

The loonie was up 0.27 of a cent to 98.89 cents US.

The U.S. reported its retail sales for April edged up 0.1 per cent on gains in automobile and clothing sales. Monthly retail sales figures are considered a key component to how an economy is faring.

Investors were largely positive that the U.S. economy is gaining traction, particularly in the jobs market, but economists had expected a 0.3 per cent decline as a result of a higher U.S. tax on Social Security that kicked in this year.

The Canadian dollar neared parity against the U.S. dollar at some points last week amid heightened investor appetite and signs that the U.S. economy is recovering as it should.

But that period may soon be over, as the loonie begins to soften due to weaker economic growth in Canada, the pull-back of commodity prices and the strengthening outlook for the U.S. greenback as all factors.

Overseas, world markets fell on news that China had slightly smaller-than-expected increases in industrial production and retail sales in April.

The Shanghai Composite Index fell 0.2 per cent to 2,241.92. The smaller Shenzhen Composite Index rose 0.3 per cent to 974.20. Hong Kong's Hang Seng fell 1.4 per cent to 22,989.81.

South Korea's Kospi rose 0.2 per cent to 1,948.70 while Australia's S

In Europe, the DAX fell 0.7 per cent to 8,222 while the FTSE 100 index of leading British shares was down 0.3 per cent at 6,405. The CAC-40 in France was 0.5 per cent lower at 3,936.

The only exception to the weakening world markets was Japan's Nikkei, which rose 1.2 per cent to 14,782.21, its highest close since December 2007. The index has soared more than 42 per cent since the beginning of the year.

The upwards traction comes after global finance leaders effectively backed the Bank of Japan's stimulus program as a legitimate attempt by the country to get out of its two-decade era of stagnation.

Meanwhile, commodity prices continued to be flat. The June crude contract was down 34 cents to US$95.68 a barrel. June gold bullion dropped $3.90 to US$1,432.70 an ounce, while July copper was unchanged at US$3.36 a pound.

http://www.globalpost.com/dispatch/news/the-canadian-press/130513/loonie-slightly-ahead-amid-positive-us-retail-sales-figures-