TSX Settles Higher On U.S. Data - Canadian Commentary

(RTTNews) - Canadian stocks ended higher Tuesday, on cues from rising global equity markets, led by materials and financial stocks with some encouraging macroeconomic data out of the U.S. and Europe, triggering hopes of a global economic recovery sooner than expected. Nonetheless, the gains were capped as investors continued to worry over the U.S. Federal Reserve's plans to scale down its quantitative easing program.

Retail sales in the U.S. rose for the fourth consecutive month in July, a report from the Commerce Department showed Tuesday, albeit slightly weaker than expected due to a notable drop in auto sales. Meanwhile, a Labor Department report indicated a modest increase in import prices in July, after registering decreases in U.S. import prices in the four previous months.

Germany's economic sentiment surged to a five-month high in August as slowing recession in many European countries and robust domestic demand, boosted investor optimism, a survey by the Center for European Economic Research, or ZEW, revealed Tuesday.

The S&P/TSX Composite Index closed Tuesday at 12,642.19, up 47.92 points or 0.38 percent. The index touched an intraday high of 12,655.79 and a low of 12,594.26.

The Information Technology Index gathered 1.24 percent, with BlackBerry Limited (BB.TO) gaining 1.71 percent, after the smartphone maker yesterday indicated seeking strategic alternatives for the company.

The Capped Materials Index shed 0.71 percent, with Potash Corporation of Saskatchewan Inc.(POT.TO) up 0.88 percent. Crop nutrients maker Agrium Inc. (AGU.TO) moved up 0.37 percent.

The Global Gold Index dropped 1.73 percent, with gold futures for December delivery shedding $13.70 or 1 percent to close at $1,320.50 an ounce Tuesday on the Nymex.

Among gold stocks, Barrick Gold Corp. (ABX.TO) slipped 1.81 percent, while Yamana Gold Inc. (YRI.TO) surrendered 1.29 percent. Kinross Gold Corp. (K.TO) dived 3.12 percent, while Goldcorp Inc. (G.TO) slipped 1.05 percent.

IAMGOLD Corp. (IMG.TO) gained 2.18 percent, after slipping to a loss in the second quarter, hurt mainly by lower sales amid weak prices and volumes, and impairment charges. Excluding items, the company posted a profit that missed Wall Street estimates.

The Diversified Metals & Mining Index fell 0.48 percent, with First Quantum Minerals Ltd. (FM.TO) down 0.21 percent. Osisko Mining Corp. (OSK.TO) dropped 2.86 percent, Teck Resources Limited (TCK.B.TO) slipped 1.77 percent, and Lundin Mining Corp. (LUN.TO) gathered 1.34 percent.

The Energy Index slipped 0.06 percent, although U.S. crude oil futures for September delivery gained $0.72 or 0.7 percent to close at $106.83 a barrel Tuesday on the Nymex.

Among energy stocks, Cenovus Energy Inc. (CVE.TO) moved up 0.41 percent, while Talisman Energy (TLM.TO) dropped 2.80 percent. Encana Corp. (ECA.TO) inched up 0.06 percent, while Suncor Energy Inc. (SU.TO) slipped 0.06 percent.

The Financial Index gained 1.03 percent with Bank of Montreal (BMO.TO) gathered 1.07 percent, Royal Bank of Canada (RY.TO) moved up 1.14 percent, and Toronto-Dominion Bank (TD.TO) added 0.96 percent. Manulife Financial Corp. (MFC.TO) jumped 2.04 percent.

The Capped Industrials Index added 1.07 percent, with Bombardier Inc. (BBD.A.TO, BBD.B.TO) shedding 0.41 percent.

Dundee Corp. (DC.A.TO) dropped 2.08 after reporting a second-quarter profit of $541.6 million or $9.97 per share, compared to a loss of $111.7 million or $2.07 per share in the same period last year.

Leon's Furniture Ltd. (LNF.TO) dipped 0.08 percent after reporting a second quarter profit of C$14.4 million or C$0.18 per share, compared to C$9.0 million or C$0.12 per share in the year-ago quarter.

In economic news, retail sales in the U.S. rose for the fourth consecutive month in July, edging up 0.2 percent in July following an upwardly revised 0.6 percent increase in June. Economists had expected sales to rise by 0.3 percent compared to the 0.4 percent increase originally reported for the previous month. The drop in sales growth was due mainly to a notable drop in auto sales.

Separately, the U.S. Commerce Department said business inventories in the U.S. were virtually unchanged in the month of June, a report showed Tuesday. Business inventories came in unchanged in June after edging down by 0.1 percent in May. Economists expected inventories to increase by about 0.2 percent.

Meanwhile, U.S. import prices showed a modest increase in July, rising 0.2 percent following a revised 0.4 percent decrease in June. However, the price growth fell well short of economist estimates for a 0.9 percent increase.

U.K. inflation slowed from a 14-month high in July as the price discounting on clothing and footwear sales partially offset the gains in fuel and transport costs, data released by the Office for National Statistics showed Tuesday. Nonetheless, factory-gate prices accelerated on higher petroleum prices, and input price inflation hit the highest since March 2012, signaling existence of inflationary pressure in the economy. Consumer price inflation dropped marginally to 2.8 percent, in line with forecast, from 2.9 percent in June. On a monthly basis, consumer prices remained flat after falling 0.2 percent in June.

Germany's economic sentiment surged to a five-month high in August as slowing recession in many European countries, along with robust domestic demand, boosted investor optimism, a survey the Center for European Economic Research, or ZEW, revealed Tuesday. The ZEW indicator of economic sentiment rose to 42, the highest since March, from 36.3 in July. The outcome was better than the expected score of 39.9. The indicator reflecting investors' assessment of the current economic conditions jumped to 18.3 in August from 10.6 in July. The reading was above the forecast of 12 and the highest since July 2012.