TSX Ends Higher After U.S. Data -- Canadian Commentary

(RTTNews) - Canadian stocks ended higher for a third straight session Wednesday, on some strong showing by energy and mining sectors amid some encouraging data from the U.S. indicating the economy to have contracted less than expected. The uptick was, however, limited after reports emerged that Greece's proposal for reforms were rejected by its creditors, fueling further uncertainties over the future of the country.

News reports citing Greek government officials said creditors were insistent Athens drop measures including planned extra charge on company profits, taxing electronic gaming and an hike in employer contributions to pensions.

Greek Prime Minister Alexis Tsipras in a tweet said international creditors are rejecting equivalent measures that were accepted for Portugal and Ireland. Greece is faced with a 1.5 billion euro payment to the IMF end June. Athens has indicated that it will not be able to make the payment without further aid.

Canadian stocks bucked the trend in Europe and the U.S., where markets were under pressure after the Greek negotiations hit a snag. Mining, energy, and gold stocks are among the top performing stocks despite a dip in gold and oil prices.

The majority of the European markets ended in the red Wednesday after creditors reportedly put forward a set of counter-proposals to Greece, rejecting the submission by Greece earlier this week. Weakness in German business confidence is adding to the negative mood.

Markets in the United States also ended in the red, with worries over Greece largely responsible for the weakness. Meanwhile, a report from the Commerce Department showed a smaller than previously estimated contraction in U.S. economic activity in the first quarter.

U.S. gross domestic product for the first quarter dipped 0.2 percent compared to the previously reported 0.7 percent drop. The modest decrease comes on the heels of a 2.2 percent growth in the fourth quarter, which were in line with economists' estimates.

The benchmark S&P/TSX Composite Index closed Wednesday at 14,947.51, up 42.60 points or 0.29 percent. The index scaled an intraday high of 14,955.33 and a low of 14,871.88.

On Tuesday, the index closed up 114.43 points or 0.77 percent, at 14,904.91. The index scaled an intraday high of 14,923.76 and a low of 14,814.37.

Crude oil futures ended lower as market sentiments were hit after Greek officials said their creditors have rejected a reform proposal that would have saved Athens from default. The drop comes despite an eighth straight week of decline in official crude oil inventories as indicated by the U.S. Energy Information Administration.

A weekly report from the U.S. Energy Information Administration showed U.S. crude oil inventories to have dropped 4.9 million barrels in the week ended June 19, while analysts expected stocks to decline 2.3 million barrels. The report showed total U.S. crude oil inventories at 463.0 million barrels end last week.

The Energy Index gained 0.80 percent, although U.S. crude oil futures for August delivery dropped $0.74 or 1.2 percent, to settle at $60.27 a barrel on the New York Mercantile Exchange Wednesday.

Among energy stocks, Suncor Energy Inc. (SU.TO) added 2.65 percent, while Crescent Point Energy Corp. (CPG.TO) fell 1.05 percent and Encana Corp. (ECA.TO) shed 0.41 percent

Enbridge Inc. (ENB.TO) moved up 1.58 percent, while Cenovus Energy (CVE.TO) ended flat at $21.15 a share.

Gold futures ended lower but rallied to pull back a little towards the close as Greece struggled to come to an agreement with its creditors on the much needed financial aid.

The Gold Index added 0.79 percent, with gold for August delivery shedding $3.70 or 0.3 percent to settle at $1,172.90 an ounce in electronic trade on the New York Mercantile Exchange Wednesday.

Among gold stocks, Goldcorp Inc. (G.TO) added 1.66 percent, and Kinross Gold Corp. (K.TO) gained 2.13 percent. IAMGOLD Corp. (IMG.TO) moved up 2.57 percent, while Eldorado Gold Corp. (ELD.TO) shed 0.78 percent.

The Capped Materials Index gained 0.42 percent, as Agrium Inc. (AGU.TO) fell 0.04 percent and Agnico Eagle Mines Limited (AEM.TO) fell 0.22percent. Franco-Nevada Corp. (FNV.TO) gained 1.37 percent, while Potash Corp. of Saskatchewan Inc. (POT.TO) dipped 0.42 percent.

The Diversified Metals & Mining Index gathered 1.59 percent, even as First Quantum Minerals Ltd. (FM.TO) gained 3.31 percent, and Teck Resources (TCK.B.TO) added 0.72 percent.

The heavyweight Financial Index added 0.42 percent, as Royal Bank of Canada (RY.TO) gained 0.22 percent, National Bank of Canada (NA.TO) moved up 0.25 percent, and Bank of Montreal (BMO.TO) gathered 0.07 percent.

Toronto-Dominion Bank (TD.TO) gained 0.42 percent, Bank of Nova Scotia (BNS.TO) added 0.73 percent, and Canadian Imperial Bank of Commerce (CM.TO) advanced 0.98 percent.

The Capped Health Care Index inched up 0.03 percent as Valeant Pharmaceuticals International, Inc. (VRX.TO) fell 1.35 percent, Extendicare Inc. (EXE.TO) fell 1.05 percent, Catamaran Corp. (CCT.TO) moved up 0.86 percent, and Concordia Healthcare Corp. (CXR.TO) gained 0.57 percent.

The Capped Industrials Index dropped 0.98 percent, as Bombardier Inc. (BBD-A.TO) dropped 0.40 percent and Finning International Inc. (FTT.TO) gained 0.25 percent. Canadian Pacific Railway Limited (CP.TO) fell 2.48 percent, while Canadian National Railway Company (CNR.TO) dipped 1.34 percent.

The Information Technology Index edged down 0.04 percent, as BlackBerry Inc. (BB.TO) gained 0.83 percent, after reporting a disappointing first-quarter profit.

Sierra Wireless, Inc. (SW.TO) dropped 0.24 percent, while Descartes Systems Group Inc. (DSG.TO) fell 0.20 percent.

The Capped Telecommunication Index edged gathered 0.97 percent, as TELUS Corp. (T.TO) gained 1.35 percent and Rogers Communications Inc. (RCI.B.TO) gathered 1.78 percent.

BCE Inc. (BCE.TO) gathered 0.56 percent, while Manitoba Telecom Services (MBT.TO) inched up 0.14 percent.

Nuvo Research (NRI.TO) gained 3.80 percent, after it received approval from the German Federal Institute for Drugs and Medical Devices to conduct a placebo controlled Phase 3 trial of Pennsaid 2%.

Sierra Wireless (SW.TO) dropped 2.47 percent after agreeing to acquire MobiquiThings for Eur 14 million in cash plus milestones.

BlackBerry (BB.TO) added 0.83 percent, after reporting a first quarter loss which came in wider than analysts' expected, even as revenues also missed estimates.

EXFO (EXF.TO) fell 3.84 percent after reporting third-quarter net earnings of $0.01 per share compared with $0.03 per share last year. Analysts expected earnings of $0.03 per share for the quarter.

Redknee Solutions (RKN.TO) surged 5.82 percent, after agreeing to buy privately held Orga Systems for Eur 38 million in cash.

On the economic front, German business confidence weakened to a four-month low in June as Greece crisis weighed on the current situation assessment and expectations of companies, results of a survey by the Munich-based Ifo Institute showed Wednesday. The business confidence index fell to a four-month low of 107.4 in June from 108.5 in May. It was expected to ease to 108.1.

The French economy expanded as initially estimated in the first quarter, final data from the statistical office Insee showed Wednesday. Gross domestic product grew 0.6 percent sequentially in the first quarter after expanding 0.1 percent in the fourth quarter. The statistical office confirmed the preliminary estimate for the first quarter. This was the fastest growth since the second quarter of 2013.

U.K. mortgage approvals increased to a 14-month high in May, the British Bankers' Association said Wednesday. The number of mortgage approvals rose to 42,530 in May from 42,020 in April. This was the highest level since March 2014, when it totaled 45,318. It was forecast to rise to 43,350.

A leading index for the Chinese economy spiked in May, a survey from the Conference Board showed Wednesday. The index rose 1.1 percent, which follows the upwardly revised 1.4 percent jump in April (originally 1.1 percent) and the 0.2 percent increase in March.