TSX Ends Sharply Higher On Global Cues -- Canadian Commentary

(RTTNews) - Canadian stocks snapped a two-day loss to end sharply higher on Friday, tracking rising global equity markets after the Bank of Japan's surprise move to expand its stimulus measures lifted investor sentiment.

The main index registered gains in most sectors with energy, financial, consumer staples, technology, healthcare, and industrial stocks being the major gainers. Despite lower crude oil prices, energy stocks edged higher on bargain hunting after recent losses.

Nonetheless, gold stocks ended on a weak note amid falling bullion prices, dragged down by a strengthening dollar.

The Bank of Japan's surprise decision to extend monetary stimulus support has prompted investors to seek riskier assets. The Japanese central bank expanded its massive quantitative and qualitative easing unexpectedly as policymakers deemed it necessary to achieve the 2 percent inflation target even after a sales tax hike in April.

In some upbeat economic news from the U.S., consumer sentiment in the country improved more than previously estimated in October, a Thomson Reuters and the University of Michigan report showed Friday. Meanwhile, business activity in the Chicago area unexpectedly increased at a notably faster rate in October, to its highest level in a year.

Investors largely ignored a report from Statistics Canada showing Canadian gross domestic product to have contracted 0.1 percent in August after stagnating in July.

The benchmark S&P/TSX Composite Index closed Friday at 14,613.32, up 154.63 points or 1.07 percent. The index scaled a intraday high of 14,626.98 and a low of 14,507.55.

On Thursday, the index ended lower led by a sell-off in gold stocks with commodity prices declining sharply after a report showed robust economic activity in the U.S. and some disappointing corporate earnings reports.

Gold futures slipped to end at four-year lows as the dollar continued to strengthen on some upbeat data from the U.S. and the Bank of Japan's decision to extend its monetary stimulus.

The Global Gold Index plunged 3.95 percent, with gold for December delivery plummeting $27.000 or 2.3 percent to settle at $1,171.60 an ounce on the New York Mercantile Exchange Friday.

Goldcorp Inc. (G.TO) added 1.49 percent, while Kinross Gold Corp. (K.TO) plummeted 12.68 percent.

Among other gold stocks, Barrick Gold Corp. (ABX.TO) shed 2.69 percent, Agnico Eagle Mines Limited (AEM.TO) fell 4.01 percent, Yamana Gold Inc. (YRI.TO) tumbled 10.02 percent, Eldorado Gold Corp. (ELD.TO) dived 8.61 percent. IAMGOLD Corp. (IMG.TO) shed 2.28 percent.

The Capped Materials Index shed 0.59 percent due mainly to declining gold stocks, although Potash Corp. of Saskatchewan Inc. (POT.TO) gained 1.88 percent.

Crude oil ended lower after the dollar continued to strengthen on some upbeat data from the U.S. and the Bank of Japan's decision to extend its monetary stimulus, driving up demand for the greenback.

However, the Energy Index jumped 2.11 percent, although U.S. crude oil futures for December delivery dropped $0.58 or 0.7 percent to close at $80.5 a barrel on the Nymex Friday.

Among other energy stocks, Suncor Energy Inc. (SU.TO) gained 2.62 percent, Canadian Natural Resources Limited (CNQ.TO) added 2.85 percent, Encana Corp. (ECA.TO) gained 2.64 percent, Talisman Energy Inc. (TLM.TO) advanced 3.16 percent, and Cenovus Energy Inc. (CVE.TO) moved up 2.05 percent.

Imperial Oil Limited (IMO.TO) surged 4.67 percent after reporting third quarter net income of $936 million or $1.10 per share, as compared to $647 million or $0.76 per share in the year ago quarter.

The Healthcare Index gained 1.49 percent, with Catamaran Corp. (CCT.TO) adding 0.96 percent, Valeant Pharmaceuticals Inc. (VRX.TO) up 1.72 percent, and Extendicare Inc. (EXE.TO) advanced 1.87 percent.

The heavyweight Financial Index added 1.05 percent, as Toronto-Dominion Bank (TD.TO) gained 1.32 percent, Canadian Imperial Bank of Commerce (CM.TO) up 0.78 percent, Bank of Montreal (BMO.TO) added 0.67 percent, and National Bank of Canada (NA.TO) moved up 0.15 percent.

Royal Bank of Canada (RY.TO) gained 0.86 percent, while Bank of Nova Scotia (BNS.TO) added 1.10 percent.

Among other financial shares, Manulife Financial Corp. (MFC.TO) gained 2.44 percent, and Sun Life Financial Inc (SLF.TO) added 1.67 percent, and Fairfax Financial Holdings (FFH.TO) gathered 1.27 percent.

The Diversified Metals & Mining Index jumped 2.09 percent, as First Quantum Minerals Ltd. (FM.TO) slipped 2.76 percent after reporting third quarter net income of $121.2 million or $0.21 per basic share, compared to $143 million or $0.24 per basic share in the year ago quarter.

Lundin Mining Corp. (LUN.TO) edged up 0.80 percent, and Teck Resources Limited (TCK.B.TO) added 1.71 percent.

The Capped Industrials Index added 1.30 percent, with Air Canada (AC.B.TO) up 2.29 percent, Canadian Pacific Railway Limited (CP.TO) up 2.17 percent, and Bombardier Inc. (BBD.B.TO) down 2.62 percent.

The Information Technology Index jumped 2.40 percent, with smartphone maker BlackBerry Limited (BB.TO) up 1.02 percent, Constellation Software Inc. (CSU.TO) jumped 4.79 percent, and Avigilon Corporation (AVO.TO) was up 2.90 percent.

The Telecom Index moved up 0.35 percent with Rogers Communications Inc. (RCI.B.TO) moving up 0.45 percent, BCE Inc. (BCE.TO) up 0.60 percent, and TELUS Corp. (T.TO) dropped 0.05 percent.

The Consumer Staples Index gained 1.12 percent, as Metro Inc. (MRU.TO) added 1.14 percent, Alimentation Couche-Tard Inc. (ATD.B.TO) moved up 1.43 percent, and Cott Corp. (BCB.TO) up 0.74 percent.

The Consumer Discretionary Index gained 1.33 percent with Magna International Inc. (MG.TO) up 3.20 percent.

Pattern Energy Group Inc (PEG.TO) slipped 0.70 percent after reporting a net loss of $9.3 million in the third quarter, against a net income of $4.2 million in the same period last year.

TransForce Inc. (TFI.TO) gained 0.62 percent after announcing sufficient shareholder support for a $495-million cash takeover offer for Contrans Group Inc. (CSS.TO). TransForce says it is in discussions with the Competition Bureau and expects the 30-day waiting period will expire on Wednesday. Contrans Group Inc. (CSS.TO) is up 0.54 percent.

In economic news from the U.S., a report from the Commerce Department showed personal spending to have unexpectedly decreased in the month of September, dipping by 0.2 percent, after climbing by 0.5 percent in August.

Additionally, the Commerce Department said personal income edged up by a lower than expected 0.2 percent in September following a 0.3 percent increase in the previous month.

Consumer sentiment in the U.S. improved more than previously estimated in October, a report from Thomson Reuters and the University of Michigan showed Friday. The final reading on the consumer sentiment index for October came in at 86.9 compared to the mid-month reading of 86.4. Economists had expected the index to be unrevised.

With the unexpected upward revision, the index rose from the final September reading of 84.6 to reach its highest level since July of 2007.

Business activity in the Chicago area unexpectedly increased at a notably faster rate in October to its highest level in a year, a report from MNI Indicators said Friday. The Chicago business barometer jumped to 66.2 in October from 60.5 in September, with a reading above 50 indicating an increase in regional business activity. Economists expected the barometer to dip to a reading of 60.0.

Eurozone inflation rose slightly in October but it remained consistently below 1 percent, signifying the risk of deflation in the currency bloc. At the same time, the unemployment rate held steady at an elevated level in September.

Eurozone inflation rose marginally to 0.4 percent in October from 0.3 percent in September, flash data from Eurostat showed Friday. It has been below the 2 percent ceiling since February 2013. Core inflation that excludes energy, food, alcohol and tobacco, slowed to 0.7 percent from 0.8 percent a month ago. It was forecast to remain unchanged at 0.8 percent.

The Bank of Japan on Friday, decided to lift the monetary base at an annual pace of about JPY 80 trillion. The earlier plan was to increase it by about JPY 60-70 trillion. The bank will lift its purchases of Japanese government bond purchases so that the outstanding amount will rise by around JPY 80 trillion compared to the earlier target of JPY 50 trillion.

Russia's central bank lifted its key rate sharply by a bigger-than-expected 150 basis points to counteract the slide in ruble and rising inflation. The Bank of Russia decided on Friday to raise its key rate to 9.50 percent from 8 percent. The bank was expected to hike its rate by 50 basis points. This was the fourth interest rate increase this year.