TSX Ends Higher Ahead Of Fed Meet - Canadian Commentary

(RTTNews) - Canadian stocks snapped a four-day losing streak to end higher Monday, with investors focused on the U.S. Federal Reserve policy meet later this week, anticipating the central bank to reaffirm its commitment to maintain the accommodative monetary policy and hold interest rates at record low until mid next year. Investors also await a slew of macroeconomic data from the U.S. for fresh cues on the health of the global economy.

The U.S. Federal Reserve will release its monetary policy statement on Wednesday, with expectations the central bank will maintain its low interest rates and reiterate plans to keep the monetary policy accommodative going. In his two-day testimony to Congress which concluded on July 18, Fed Chairman Ben Bernanke said it was too early to make a judgment on tapering bond purchases.

The S&P/TSX Composite Index closed Monday at 12,669.04, up 21.14 points or 0.17 percent. The index touched an intraday high of 12,688.41 and a low of 12,618.01.

The Global Gold Index shed 0.78 percent, although gold futures for August delivery gained $6.90 or 0.5 percent to close at $1,328.40 an ounce Monday on the Nymex.

Among gold stocks, Yamana Gold Inc. (YRI.TO) shed 2.06 percent, while Kinross Gold Corp. (K.TO) surrendered 1.95 percent. Barrick Gold Corp. (ABX.TO) fell 1.04 percent, while Goldcorp Inc. (G.TO) slipped 0.24 percent.

The Capped Materials Index shed 0.12 percent, although Potash Corporation of Saskatchewan Inc.(POT.TO) added 1.99 percent.

The Diversified Metals & Mining Index dived 3.00 percent, with First Quantum Minerals Ltd. (FM.TO) down 1.59 percent. Lundin Mining Corp. (LUN.TO) slipped 0.93 percent, while Osisko Mining Corp. (OSK.TO) gathered 2.05 percent. Teck Resources Limited (TCK.B.TO) surrendered 1.63 percent.

The Energy Index dropped 0.51 percent, with U.S. crude oil futures for September delivery shedding $0.15 or 0.1 percent to close at $104.55 a barrel Monday on the Nymex.

Among energy stocks, Suncor Energy Inc. (SU.TO) gained 0.25 percent, while Enbridge Inc. (ENB.TO) moved up 0.61 percent. Canadian Natural Resources Limited (CNQ.TO) dropped 0.71 percent, while Cenovus Energy Inc. (CVE.TO) added 0.49 percent. Encana Corp. (ECA.TO) dropped 2.49 percent, while Tourmaline Oil Corp. (TOU.TO) plunged 4.29 percent.

The Financial Index gained 0.36 percent with Bank of Montreal (BMO.TO) up 0.37 percent, Royal Bank of Canada (RY.TO) gained 0.35 percent, and Toronto-Dominion Bank up 0.60 percent. Bank of Nova Scotia (BNS.TO) gathered 0.67 percent, while National Bank of Canada (NA.TO) added 0.59 percent.

The Information Technology Index added 0.79 percent, with BlackBerry Limited (BB.TO) down 2.63 percent.

The Capped Industrials Index moved up 0.30 percent, with Bombardier Inc. (BBD.A.TO, BBD.B.TO) up 3.27 percent.

Department stores operator Hudson's Bay Company (HBC.TO) gained 5.82 percent after indicating it would acquire Saks Incorporated (SKS) for US$16.00 per share in an all-cash transaction valued at approximately US$2.9 billion, including debt. Hudson's Bay further said it intends to continue paying a quarterly dividend of C$0.09375 per share through closing of the transaction; after closing, the company expects to reduce its quarterly dividend to C$0.05 per share to accelerate deleveraging in the short term.

Electric utility Capital Power Corp. (CPX.TO) gathered 1.42 percent after reporting a swing to profit in the second-quarter, with net income of C$20 million or C$0.19 per share, compared with a net loss of C$32 million or C$0.57 per share last year. Adjusted earnings were C$17 million or C$0.24 per share, compared with C$5 million or C$0.07 per share a year ago. Analysts estimated earnings of C$0.19 per share for the quarter.

In economic news from the U.S., the National Association of Realtors said its pending home sales index edged down 0.4 percent to 110.9 in June from a downwardly revised 111.3 in May. Economists had been expecting the index to drop by about 1.4 percent. A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

From Europe, U.K. mortgage approvals declined in June despite measures taken by the government and central bank to ease credit conditions, data from the Bank of England showed. The number of loans approved for house purchases fell unexpectedly to 57,667 in June from 58,071 in May. It was forecast to rise to 59,500 in June.

During the week, investor focus will be on the monthly U.S. non-farm payrolls report for July and the FOMC meeting beginning on Tuesday. Focus will also on the results of the Institute for Supply Management's national manufacturing survey for July and a couple of regional manufacturing surveys from the ISM-Chicago, the results of ADP's private payrolls survey, the National Association of Realtors' pending home sales index for June, the Conference Board's consumer confidence reading for July, the jobless claims report and the Commerce Department's personal income and spending report for June.