TSX Rebounds To End Higher On Energy, Gold Stocks -- Canadian Commentary

(RTTNews) - Canadian stocks rebounded to end higher on Tuesday, after having plunged 2.3 percent yesterday, as commodity prices rallied to pull up energy and gold stocks from their depths.

Nonetheless, the gains were somewhat muted with banks coming under heavy pressure amid uncertainty about the timing of U.S. interest rate hikes and on concerns about the global economy, as well as on developments in Greece and China.

Greece was once gain plunged into a political turmoil after Prime Minister Antonis Samaras brought forward the presidential election in a do or die situation.

In the event Samaras fails to get his presidential candidate elected, he will be left with no option but to call for snap national election, which analysts feel would be overwhelmingly in favor of the leftist Syriza party. The Syriza party is a fierce opponent to the bailout deal Greece has with the European Union and the IMF.

Meanwhile, China introduced rules by which lower rated bonds can no longer be used as collateral in short-term borrowing, sparking a sell-off in riskier assets including government bonds. The Chinese clearing agency for exchanges said that under the new loan rules, bonds below AAA rating cannot be used as collateral for obtaining short-term loans through repurchase agreements.

The benchmark S&P/TSX Composite Index closed Tuesday at 14,195.73, up 51.56 points or 0.36 percent. The index scaled a intraday high of 14,195.73 and a low of 14,001.03.

On Monday, the index ended at 14,144.17, down 329.53 points or 2.3 percent, after dropping to its lowest level since February 14, 2014, on falling crude oil prices and renewed worries over the global economy on the back of some weak data from Asia and eurozone contributing to the market decline.

Crude oil rebounded to end higher on a weak dollar with global equity markets declining on developments in Greece and China.

The Energy Index moved up 1.13 percent, with U.S. crude oil futures for January delivery gaining $0.77 or 1.2 percent to close at $63.82 a barrel on the Nymex Tuesday.

Among energy stocks, Canadian Oil Sands Limited (COS.TO) added 0.50 percent, Canadian Natural Resources Limited (CNQ.TO) gathered 0.93 percent, Pacific Rubiales Energy Corp. (PRE.TO) gained 0.98 percent, Suncor Energy Inc. (SU.TO) added 0.95 percent, and Cenovus Energy Inc. (CVE.TO) moved up 0.45 percent.

Imperial Oil Limited (IMO.TO) slipped 0.34 percent, Crescent Point Energy Corp. (CPG.TO) shed 0.24 percent, and Encana Corp. (ECA.TO) shed 0.84 percent.

Talisman Energy Inc. (TLM.TO) jumped 11.86 percent after confirming that it has been approached by several parties, including Spanish oil company Repsol S.A. (REPYY.PK), with regards to various transactions.

Enbridge Inc. (ENB.TO) gathered 0.69 percent.

Gold futures soared to end higher on its safe haven appeal as the dollar trended lower even as global equity markets fell after China tightened rules on short-term loans.

The Global Gold Index jumped 4.45 percent, with gold for February delivery surging $37.10 or 3.1 percent to settle at $1,232.00 an ounce on the New York Mercantile Exchange Tuesday.

In the gold space, Barrick Gold Corp. (ABX.TO) gained 3.84 percent, Agnico Eagle Mines Limited (AEM.TO) jumped 7.08 percent, Goldcorp Inc. (G.TO) added 3.84 percent, Franco-Nevada Corp. (FNV.TO) moved up 2.97 percent, and Yamana Gold Inc. (YRI.TO) surged 6.28 percent.

The Capped Materials Index gained 2.34 percent, mostly on gold stocks, with Potash Corp. of Saskatchewan Inc. (POT.TO) shedding 0.45 percent.

The Financial Index dropped 0.30 percent, with Bank of Nova Scotia (BNS.TO) up 0.48 percent, National Bank of Canada (NA.TO) dived 2.52 percent, Canadian Imperial Bank of Commerce (CM.TO) inched up 0.07 percent, and Toronto-Dominion Bank (TD.TO) moved up 0.04 percent. Royal Bank of Canada (RY.TO) gained 0.06 percent, and Bank of Montreal (BOM.TO) shed 0.06 percent.

The Healthcare Index fell 1.12 percent, as Valeant Pharmaceuticals International, Inc. (VRX.TO) shed 2.57 percent, Catamaran Corp. (CCT.TO) dipped 0.05 percent, and Extendicare Inc. (EXE.TO) slipped 0.47 percent.

The Diversified Metals & Mining Index jumped 2.25 percent, as First Quantum Minerals Ltd. (FM.TO) gained 3.83 percent, Teck Resources Limited (TCK.B.TO) dipped 0.50 percent, Lundin Mining Corp. (LUN.TO) added 2.57 percent, and Sherritt International Corp. (S.TO) dropped 1.28 percent.

The Capped Industrials Index added 0.47 percent, as Bombardier Inc. (BBD.B.TO) dropped 1.22 percent, Canadian National Railway Company (CNR.TO) moved up 0.72 percent, and SNC-Lavalin Group Inc. (SNC.TO) jumped 5.12 percent. Air Canada (AC.TO) fell 4.89 percent, while WestJet Airlines Ltd. (WJA) dived 3.30 percent.

The Information Technology Index gathered 0.42 percent with Descartes Systems Group Inc. (DSG.TO) gaining 1.95 percent and Avigilon Corp. (AVO.TO) soaring 5.97 percent.

BlackBerry Ltd. (BB.TO) shed 0.99 percent.

The Capped Telecommunication Index fell 0.34 percent, as BCE Inc. (BCE.TO) added 0.17 percent, Manitoba Telecom Services Inc. (MBT.TO) slipped 0.95 percent, Rogers Communications Inc. (RCI.B.TO) shed 0.86 percent, and TELUS Corp. (T.TO) dropped 0.15 percent.

The Consumer Staples Index added 1.07 percent with Metro Inc. (MRU.TO) up 0.67 percent, Saputo Inc. (SAP.TO) down 0.12 percent, and George Weston Limited (WN.TO) up 0.60 percent.

Endo International (ENL.TO) dropped 0.59 percent after announcing it has completed the acquisition of rights to Natesto, the first and only testosterone nasal gel, from Trimel Pharmaceuticals Corporation's (TRL.TO) subsidiary Trimel BioPharma SRL, for $25 million. Trimel Pharma is up 3.08 percent.

Hudson's Bay Co. (HBC.TO) gained 0.81 percent after reporting a third-quarter net loss of C$13 million or C$0.07 per share, substantially lower than the net loss of C$125 million or C$1.05 per share reported last year.

In economic news, wholesale inventories in the U.S. rose more than anticipated in October, a report from the Commerce Department showed Tuesday. Wholesale inventories climbed 0.4 percent in October, matching the upwardly revised increase in September. Economists expected inventories to inch up by 0.2 percent compared to the 0.3 percent growth originally reported for the previous month.

A report from the U.S. Labor Department said job openings at workplaces in October climbed to 4.83 million from 4.69 million in September. When compared to the similar period a year ago, job openings in October rose 21 percent, with private-sector openings rising 23 percent. The ratio of job seekers per opening works out to 1.9 in October from 2 in September.

Industrial production in the U.K. dropped unexpectedly in October due to a contraction in manufacturing, signaling a weak start to the fourth quarter. Industrial production fell 0.1 percent from September, when it rose 0.7 percent, the Office for National Statistics said Tuesday. Production was expected to expand by 0.2 percent.

Germany's exports decreased marginally in October, while imports logged the steepest decline in nearly two years, data from Destatis showed Tuesday. Trade surplus increased to a seasonally adjusted EUR 20.6 billion in October from EUR 18.6 billion in September.

German exports dropped 0.5 percent month-on-month in October reversing a 5.5 percent rise in September. Economists had forecast a 1.7 percent drop for October. Meanwhile, imports tumbled 3.1 percent after increasing 5.2 percent a month ago. It was the biggest fall since November 2012 and was worse than the expected 1.7 percent fall.

The Organization for Economic Cooperation and Development said its composite leading indicators signaled stable growth momentum in most major economies and in the OECD area as a whole. The leading index held steady at 100.4 in October. The index continues to point stable expansion in the United States, Canada, China and Brazil, while tentative signs of a positive change in momentum are emerging in Japan. India is the only major economy where the CLI points to a clear pick-up in growth momentum, it said.