Canadian Stocks Are Rising On China Strength -- Canadian Commentary

(RTTNews) - The Canadian stock market is up in early trade Monday, after returning to action following the Labour Day holiday. Markets across the globe are climbing after the strong performance of the Chinese stock market in late trade. The majority of the Canadian sectors are positive this morning, but energy and gold stocks are lagging behind.

China's Shanghai Composite Index jumped by 2.9 percent, after a slew of support measures were unleashed by Beijing. The measures included tax exemption on dividends and a move to introduce a market-wide circuit breaker system to stabilize the market also helped investors shrug off weak data underlying weakness in the world's second-largest economy.

Markets in Europe are rising Tuesday, after German exports expanded by more-than-expected in July. The Eurozone economy also grew more than initially estimated in the second quarter.

Markets in the United States are also climbing in early trade Tuesday. The strength in China has provided a boost after the long holiday weekend. However, traders may be reluctant to make any significant moves amid a lack of major U.S. economic data.

The benchmark S&P/TSX Composite Index is up 137.65 points or 1.02 percent at 13,615.96.

On Friday, the index closed down 118.10 points or 0.87 percent, at 13,478.31. The index scaled an intraday high of 13,509.95 and a low of 13,414.58.

The Diversified Metal and Mining Index is surging by 5.87 percent. HudBay Minerals (HBM.TO) is gaining 5.80 percent and First Quantum Minerals (FM.TO) is soaring by 12.90 percent. Capstone Mining (CS.TO) is up 6.56 percent and Sherritt International (S.TO) is increasing by 2.97 percent. Lundin Mining (LUN.TO) is also higher by 4.76 percent.

The Capped Industrials Index is up 1.80 percent. Finning International (FTT.TO) is increasing by 2.27 percent and Air Canada (AC.TO) is gaining 1.93 percent. Canadian Pacific Railway (CP.TO) is rising by 1.57 percent and Canadian National Railway (CNR.TO) is adding 2.19 percent.

Bombardier (BBD-A.TO) is also climbing by 2.33 percent. Nico Buchholz has been appointed as its Senior Vice President and Chief Procurement Officer.

The Capped Information Technology Index is gaining 1.28 percent. BlackBerry (BB.TO) is increasing by 1.97 percent and Constellation Software (CSU.TO) is higher by 1.47 percent. Descartes Systems Group (DSG.TO) is also adding 1.72 percent.

The heavyweight Financial Index is rising by 1.32 percent. National Bank of Canada (NA.TO) is increasing by 1.18 percent and Bank of Montreal (BMO.TO) is gaining 1.34 percent. Canadian Imperial Bank of Commerce (CM.TO) is higher by 1.27 percent and Royal Bank of Canada (RY.TO) is advancing by 1.27 percent. Bank of Nova Scotia (BNS.TO) is climbing by 1.90 percent and Toronto-Dominion Bank (TD.TO) is up 1.35 percent.

The Capped Materials Index is up 1.42 percent. Silver Wheaton (SLW.TO) is advancing by 2.38 percent and Agrium (AGU.TO) higher by 2.11 percent. Potash Corp. of Saskatchewan (POT.TO) is increasing by 1.12 percent.

The Capped Telecommunication Services Index is advancing by 0.50 percent. BCE (BCE.TO) is gaining 1.62 percent and TELUS (T.TO) is rising by 0.33 percent. Rogers Communication (RCI-A.TO) is also up 0.13 percent.

The Energy Index is increasing by 0.34 percent. Crude oil prices were lower Tuesday morning after the OECD predicted slower economic growth in the US and China.

Cenovus Energy (CVE.TO) is rising by 0.55 percent and Canadian Natural Resources (CNQ.TO) is higher by 0.77 percent. Enbridge (ENB.TO) is climbing by 0.67 percent and Encana (ECA.TO) is up 3.53 percent. Canadian Oil Sands (COS.TO) is up 0.32 percent and Crescent Point Energy (CPG.TO) is adding 0.72 percent.

Husky Energy (HSE.TO) is gaining 2.17 percent. The company has started production from a second oil well at its South White Rose Extension Drill Centre.

Paladin Energy (PDN.TO) is rising by 2.70 percent. The company announced the repurchase of a principal amount of US$20,000,000 of its outstanding US$274,000,000 6.00% Convertible Bonds due 2017.

The Gold Index is rising by 0.36 percent. Barrick Gold (ABX.TO) is gaining 1.06 percent and Eldorado Gold (ELD.TO) is increasing by 3.31 percent.

The Capped Health Care Index is falling by 1.04 percent. Extendicare (EXE.TO) is down 0.86 percent.

Concordia Healthcare (CXR.TO) is sinking by 7.32 percent, after it agreed to acquire U.K.-based drug-maker Amdipharm Mercury Ltd. from European private equity firm Cinven and other investors for about $3.5 billion.

AuRico Metals (AMI.TO) is climbing by 7.58 percent, after it agreed to acquire Mineral Streams Inc.

On the economic front, Chinese exports declined for the second straight month in August even after the devaluation of its currency and successive interest rate reductions. Moreover, imports logged a double-digit decline signaling weak domestic demand.

Exports fell 5.5 percent year-on-year in August following the prior month's 8.3 percent decrease. Economists had forecast a 6.6 percent drop.

At the same time, imports slid 13.8 percent after easing 8.1 percent in July. Imports were expected to fall at a slower pace of 7.9 percent.

Consequently, the trade balance showed a surplus of $60.24 billion in August. It was well above the expected level of $48 billion.

German exports expanded more-than-expected to a record high in July, led by a weak euro, suggesting that it would again be the major growth engine in the third quarter.

Exports rose 2.4 percent month-on-month in July, which was the fastest growth since December 2014. Economists had forecast shipments to grow 1 percent reversing a 1.1 percent fall in June.

Similarly, imports advanced by a faster-than-expected 2.2 percent in July after declining 0.8 percent in June. Imports were expected to grow 0.7 percent.

France's trade deficit in July widened more-than-expected from the previous month as both exports and imports moderated, figures from the French Customs showed Tuesday. The trade deficit increased to EUR 3.299 billion from EUR 2.757 billion in June, which was the smallest since July 2009. Economists had forecast a shortfall of EUR 3.100 billion. A year ago, the deficit was EUR 5.557 billion.

Eurozone economy grew more than initially estimated in the second quarter as strong exports offset the decline in investment. Gross domestic product advanced 0.4 percent sequentially after rising 0.5 percent a quarter ago, Eurostat reported Tuesday. The first quarter growth was the fastest since the same quarter of 2011, when the economy expanded 0.9 percent.

In commodities, crude oil futures for October delivery are down $1.30 or 2.82 percent at $44.75 a barrel.

Natural gas for October is up 0.054 or 2.03 percent at $2.709 per million btu.

Gold futures for December are down $0.60 or 0.05 percent at $1,120.80 an ounce.

Silver for December is up $0.071 or 0.49 percent at $14.62 an ounce.