TSX Ends Higher On Upbeat Data -- Canadian Commentary

(RTTNews) - Canadian stocks snapped a three-day loss to end higher on Wednesday, with investors reacting positively to some upbeat Canadian and U.S. trade data, and some encouraging earnings reports.

Nonetheless, the gains were checked by some soft data from Europe showing a contraction in Italian GDP and geopolitical worries amid escalating tension in Ukraine.

Tensions in Ukraine continued to escalate with Russia positioning its troops along the east Ukrainian border, with President Vladimir Putin reportedly ordering retaliatory measures against the west for sanctions.

However, positive reaction to some strong earnings reports and trade data from either side of the border pulled stocks out of the red.

According to Statistics Canada, trade surplus widened to C$1.86 billion in June, up from C$580 million in the preceding month.

A report from the U.S. Commerce Department showed U.S. trade deficit to have unexpectedly narrowed to $41.5 billion in June.

The S&P/TSX Composite Index closed Wednesday at 15,202.09, up 14.38 points or 0.09 percent. The index scaled a intraday high of 15,226.31 and a low of 15,121.99.

On Tuesday, the index closed lower after some disappointing Chinese economic data showing its service purchasing managers' index declining.

Crude oil ended lower Wednesday, on demand growth concerns with the situation in eastern Ukraine continuing to escalate. Investors also monitored the situation in Ukraine where Russia has reportedly positioned its forces along the border, indicative of a possible invasion.

The Energy Index inched down 0.03 percent, with U.S. crude oil futures for September delivery dropping $0.46 or 0.5 percent to close at $96.92 a barrel Wednesday on the Nymex.

Energy stock Canadian Oil Sands Ltd (COS.TO) slipped 1.24 percent, Enbridge Inc. (ENB.TO) was down 0.30 percent, Suncor Energy Inc. (SU.TO) shed 0.74 percent, Canadian Natural Resources Limited (CNQ.TO) down 0.43 percent, Talisman Energy (TLM.TO) added 0.53 percent, Encana Corp. (ECA.TO) dropped 0.26 percent, and Cenovus Energy (CVE.TO) dropped 0.54 percent.

The Healthcare Index shed 0.79 percent with Valeant Pharmaceuticals Inc. (VRX) shedding 1.05 percent and Extendicare Inc (EXE.TO) down 1.34 percent.

The Financial Index added 0.13 percent with Toronto-Dominion Bank up 0.32 percent, National Bank of Canada (NA.TO) added 0.46 percent, and Bank of Nova Scotia (BNS.TO) slipped 0.56 percent.

Canadian Imperial Bank Of Commerce (CM.TO) added 0.35 percent, Royal Bank of Canada (RY.TO) added 0.20 percent, and Bank of Montreal (BMO.TO) up 0.02 percent.

Gold futures ended sharply higher on Wednesday, with investors opting for its safe haven appeal, tracking weak European and Asian equity markets, on concerns over the escalating situation in Ukraine and the Middle East.

Global Gold Index gained 1.61 percent, with gold futures for December delivery surging $22.90 or 1.8 percent to close at $1,308.20 an ounce on the Nymex Wednesday.

Among gold stocks, Yamana Gold Inc. (YRI.TO) gathered 1.18 percent, Barrick Gold Corp. (ABX.TO) gained 1.37 percent, Goldcorp Inc. (G.TO) added 1.25 percent, and Eldorado Gold Corp. (ELD.TO) advanced 3.12 percent.

The Capped Materials Index gained 0.16 percent on gold mining stocks, with Potash Corp. of Saskatchewan Inc. (POT.TO) down 0.57 percent.

The Diversified Metals & Mining Index added 0.86 percent, with First Quantum Minerals Ltd. (FM.TO) down 0.76 percent, Lundin Mining Corp. (LUN.TO) up 1.11 percent and Teck Resources Limited (TCK.B.TO) dipped 0.58 percent.

The Capped Industrials Index shed 0.24 percent, with Bombardier Inc. (BBD.B.TO) up 0.80 percent and Air Canada (AC.B.TO) slipping 0.22 percent.

The Capped Telecommunications Index dropped 0.67 percent, with Telus Corp. (T.TO) down 0.58 percent, BCE Inc. (BCE.TO) down 0.97 percent, Rogers Communications Inc. (RCI.B.TO) down 0.70 percent and Manitoba Telecom Services Inc. (MBT.TO) dropped 0.39 percent.

The Information Technology Index gained 0.25 percent, with BlackBerry Limited (BB.TO) down 0.19 percent, and Avigilon Corp. (AVO.TO) up 4.12 percent.

The Capped Utilities Index fell 0.13 percent with Fortis Inc. (FTS.IR.TO) adding 0.84 percent.

In corporate news, WestJet Airlines Ltd. (WJA.TO) dropped 0.03 percent, after the airliner reported a 6.7 percent year-over-year jump in its air traffic in July, on a 6.6 percent capacity increase. Load factor in July was 83.3 percent, an increase of 0.2 points from the prior-year period.

WSP Global Inc (WSP.TO) declined 0.48 percent, despite posting first quarter net earnings of $28.8 million or $0.47 per share, up 37.8 percent and 17.5 percent, respectively from the year ago quarter.

Bellatrix Exploration Ltd (BXE.TO) gained 3.13 percent. The company reported second quarter net income of $0.22 per basic share, compared to $0.14 per basis share last year.

BlackBerry Limited (BB.TO) dropped 0.19 percent. The company said its Secure Work Space for iOS and Android has received Security Technical Implementation Guide or STIG approval from the Defense Information Systems Agency or DISA.

Tim Hortons Inc. (THI.TO) jumped 7.39 percent after it reported better than expected net income of C$123.75 million for the second quarter 2014, little changed from previous corresponding quarter. Earnings per share improved to C$0.92, from C$0.81 a year ago.

Molson Coors Brewing Company (TPX.TO) gained 4.91 percent after reporting second quarter net income of $290.9 million, up from the prior year's $267.3 million, with earnings per share improving to $1.56 from $1.45 last year.

Dorel Industries Inc.'s (DII.A.TO) ended flat at $39.05 a share after reporting second-quarter 2014 net income was $15.2 million or $0.47 per share, a 14.9 percent increase from $13.2 million or $0.41 per share, reported a year.

ZCL Composites Inc (ZCL.TO) gained 1.09 percent, after reporting net income of $4.5 million or $0.15 per fully diluted share for the first quarter, down $0.6 million or 12 percent from $5.1 million or $0.17 per fully diluted share last year.

In economic news from the U.S., a report from the Commerce Department showed U.S. trade deficit to have shrunk 7 percent to $41.5 billion in June, due largely to a notable drop in petroleum imports. Economists expected the trade deficit to widen to $45 billion from $44.4 billion in May.

The Italian economy re-entered recession as the gross domestic product contracted for the second consecutive time during the three months to June, preliminary estimates from the statistical office Istat showed Wednesday. Italy's gross domestic product fell unexpectedly by 0.2 percent sequentially in the second quarter, the fastest decline in a year. Economists expected the economy to expand 0.1 percent.

Italy's GDP expanded only in one quarter since the second quarter of 2011. Year-on-year, GDP decreased 0.3 percent with economists anticipating a growth of 0.1 percent for the second quarter.

British industrial production rebounded less-than-expected in June, with industrial and manufacturing output rising 0.3 percent each in June, the Office for National Statistics said Wednesday. Economists expected industrial production and manufacturing output to rise 0.6 percent.

Meanwhile, German factory orders declined unexpectedly by an adjusted 3.2 percent in June from May, when it fell by a revised 1.6 percent, Destatis reported Wednesday. Economists had forecast a 0.9 percent increase for June. The decline was the biggest since September 2011, when orders plunged by 3.4 percent.

Traders are also gearing up for Thursday's policy statement from the European Central Bank, looking for indication about further stimulus to revive the sagging eurozone economy.