TSX Ends First Trading Day Of Year On Positive Note -- Canadian Commentary

(RTTNews) - Canadian stocks ended on a positive note Friday, as Bay Street reopened following the New Year holiday break, driven by by resource stocks with mining stocks gaining on higher gold prices, even as investors largely ignored a couple of soft economic data from the U.S.

The main index also weighed comments from European Central Bank president Mario Draghi who helped add to the speculation the bank will provide further stimulus. In an interview with German financial daily Handelsblatt, Draghi said the risk of deflation in the euro area has risen while indicating the ECB is preparing to react to the situation.

Meanwhile, in some disappointing economic news from the U.S., manufacturing sector dropped to a six-month low in December, after a slight slowdown in growth in the previous month. Construction spending in the U.S. also dropped unexpectedly in November, due primarily to a steep drop in spending on public construction.

The benchmark S&P/TSX Composite Index closed Friday at 14,753.65, up 121.21 points or 0.83 percent. The index scaled an intraday high of 14,756.30 and a low of 14,631.35.

Crude oil ended lower with continued worries over a global supply glut, the lowest close for a most-active contract since April 2009.

The Energy Index gained 1.58 percent, although U.S. crude oil futures for February delivery dropped $0.58 or 1.1 percent, to close at $52.69 a barrel on the Nymex Friday.

Among energy stocks, Canadian Natural Resources Limited (CNQ.TO) gained 1.54 percent, Suncor Energy Inc. (SU.TO) added 1.22 percent, and Canadian Oil Sands Limited (COS.TO) shed 0.86 percent.

Pacific Rubiales Energy Corp. (PRE.TO) moved up 2.36 percent, Encana Corp. (ECA.TO) gained 0.49 percent, Crescent Point Energy Corp. (CPG.TO) gathered 1.60 percent, and Cenovus Energy Inc. (CVE.TO) advanced 1.71 percent.

Gold futures ended the first trading day of the new year higher tracking some declining global equity markets weighed down by some soft economic data from the U.S.

The Global Gold Index gained 3.89 percent, with gold for February delivery adding $2.10 or about 0.2 percent to settle at $1,186.20 an ounce on the New York Mercantile Exchange Friday.

Among gold stocks, Kinross Gold Corp. (K.TO) jumped 5.21 percent, Agnico Eagle Mines Limited (AEM.TO) surged 9.68 percent, Goldcorp Inc. (G.TO) added 2.98 percent, Eldorado Gold Corp. (ELD.TO) jumped 6.36 percent, and Franco-Nevada Corp. (FNV.TO) added 0.94 percent.

Barrick Gold Corp (ABX.TO) was up 2.72 percent after the Supreme Court of Chile declined to consider an appeal of a lower court decision regarding fines imposed on its Pascua-Lama mining project.

The Capped Materials Index added 2.86 percent, mostly on rising gold stocks, with Potash Corp. of Saskatchewan Inc. (POT.TO) up 1.68 percent.

The heavyweight Financial Index edged down 0.01 percent, as National Bank of Canada (NA.TO) added 1.23 percent, Toronto-Dominion Bank (TD.TO) slipped 0.56 percent, and Bank of Nova Scotia (BNS.TO) dropped 1.04 percent.

Royal Bank of Canada (RY.TO) added 0.26 percent, while Bank of Montreal (BMO.TO) gained 0.45 percent. Canadian Imperial Bank of Commerce (CM.TO) moved up 0.52 percent.

The Healthcare Index added 1.77 percent, as Valeant Pharmaceuticals International, Inc. (VRX.TO) gained 2.19 percent.

The Diversified Metals & Mining Index jumped 3.39 percent, as Teck Resources Limited (TCK.B.TO) gained 1.57 percent, First Quantum Minerals Ltd. (FM.TO) jumped 4.72 percent, and Finning International Inc. (FTT.TO) inching up 0.08 percent. Lundin Mining Corp. (LUN.TO) gained 1.92 percent.

The Capped Industrials Index dipped 0.04 percent, with Bombardier Inc. (BBD.B.TO) adding 1.51 percent.

The Information Technology Index added 0.46 percent, although BlackBerry Ltd. (BB.TO) ended flat at $12.74 a share.

The Capped Telecommunication Index gained 0.96 percent with BCE Inc. (BCE.TO) adding 0.84 percent and Rogers Communications Inc. (RCI.A.TO) advancing 1.04 percent.

Ballard Power (BLD.TO) plummeted 9.70 percent after indicating it will not achieve its 2014 revenue and adjusted EBITDA guidance due to breaches of two contracts by Azure Hydrogen.

On the economic front, the ISM said its purchasing managers index dropped to 55.5 in December from 58.7 in November. Economists had expected the index to drop to 57.5. With the bigger than expected decrease, the index is at its lowest since hitting 55.3 in June.

The U.S. Commerce Department said construction spending fell 0.3 percent to an annual rate of $975.0 billion in November from the revised October estimate of $977.7 billion. The drop came as a surprise with economists anticipating an increase of about 0.5 percent.

From the eurozone, German manufacturing sector returned to growth, as initially estimated in December, as new orders expanded for the first time in four months, final data from Markit Economics showed Friday. Germany's Purchasing Managers' Index rose to 51.2, in line with flash estimate, from November's 17-month low of 49.5.

Nevertheless, the French manufacturing sector contracted more than initially estimated to a four-month low in December, with the PMI dropping to 47.5 in December from 48.4 in November, below the flash estimate of 47.9.

European Central Bank President Mario Draghi said the risk of deflation in the euro area had risen over the months, with the central bank preparing to react to such threats, if necessary. Draghi's comments suggest that the ECB is moving closer to unleashing full-blown quantitative easing, including sovereign bond purchases, which dragged the euro to its lowest level in more than four years.