TSX Ends Higher Amid Global Tensions -- Canadian Commentary

(RTTNews) - Canadian stocks ended higher on Friday, tracking rising U.S. equity markets amid lingering concerns over the ongoing conflicts in Ukraine, Israel and Iraq. Nonetheless, a mixed batch of economic data from the U.S., eurozone and Canada contributed to the market uptick.

The geopolitical scenario continued to remain bleak with renewed fighting in Gaza after the three-day ceasefire ended. In Iraq, the U.S. military began dropping bombs targeting Islamic militants, following U.S. President Barack Obama authorizing airstrikes to thwart the advancing Islamic militants.

Investors are weighed the possible impact of Russia's retaliation to last week's sanctions by the Western countries. Russia's aggressive stand include a ban on import of agricultural produce from the U.S. and the European Union, which is in retaliation to the U.S. and the European Union's additional sanctions on Russia for its alleged involvement in supporting separatists in eastern Ukraine.

In some encouraging data, a Statistics Canada report on Friday showed unemployment to have declined more than expected in July as compared to June.

In other economic news, wholesale inventories in the U.S. rose by less than expected in June, even as wholesale sales indicated only a modest increase, a report from the Commerce Department showed Friday. Meanwhile, labor productivity in the U.S. increased more than anticipated in the second quarter, with the jump in contributing to a smaller than expected increase in labor costs.

Chinese exports rose notably more than expected in July on strong foreign demand but weak domestic consumption dragged imports, taking the trade surplus to a record high.

The S&P/TSX Composite Index closed Friday at 15,196.31, up 77.88 points or 0.52 percent. The index scaled a intraday high of 15,204.56 and a low of 15,092.11.

On Thursday, the index closed lower after comments from European Central Bank President Mario Draghi's who warned of risks faced by the eurozone economy.

Crude oil ended higher amid escalating tensions in Ukraine and Iraq, with increasing concerns of possible supply disruptions from the Middle East after U.S. President Barack Obama authorized airstrikes on Iraqi militants.

The Energy Index jumped 1.74 percent, with U.S. crude oil futures for September delivery gaining $0.31 or 0.3 percent to close at $97.65 a barrel Friday on the Nymex.

Among energy stocks, Canadian Natural Resources Limited (CNQ.TO) added 2.86 percent, Enbridge Inc. (ENB.TO) moved up 0.53 percent, Suncor Energy Inc. (SU.TO) added 1.03 percent, Talisman Energy (TLM.TO) gained 3.08 percent, Encana Corp. (ECA.TO) added 2.37 percent, and Cenovus Energy Inc. (CVE.TO) advanced 2.01 percent.

The Healthcare Index jumped 2.31 percent with Valeant Pharmaceuticals Inc. (VRX) added 2.74 percent, Catamaran Corp. (CCT.TO) up 2.12 percent, and Extendicare Inc. (EXE.TO) jumped 2.15 percent.

The Financial Index edged down 0.01 percent as all major banks ended in the red. Toronto-Dominion Bank dropped 0.63 percent, National Bank of Canada (NA.TO) dipped 0.04 percent, and Bank of Nova Scotia (BNS.TO) surrendered 0.99 percent.

Canadian Imperial Bank Of Commerce (CM.TO) dipped 0.71 percent, Royal Bank of Canada (RY.TO) dropped 0.58 percent, and Bank of Montreal (BMO.TO) slipped 0.25 percent.

Gold futures ended lower after trading higher for much of the day on news that President Barack Obama authorized a limited airstrike on militants in Iraq.

Global Gold Index gained 0.29 percent, with gold futures for December delivery shedding $1.50 or 0.1 percent to close at $1,311.00 an ounce on the Nymex Friday.

Among gold stocks, Yamana Gold Inc. (YRI.TO) dropped 0.42 percent, Barrick Gold Corp. (ABX.TO) gained 1.64 percent, Goldcorp Inc. (G.TO) down 0.29 percent, and Eldorado Gold Corp. (ELD.TO) moved up 0.33 percent.

The Capped Materials Index gained 0.28 percent on gold mining stocks, with Potash Corp. of Saskatchewan Inc. (POT.TO) up 1.81 percent.

The Diversified Metals & Mining Index added 0.92 percent, with First Quantum Minerals Ltd. (FM.TO) up 0.57 percent, Lundin Mining Corp. (LUN.TO) up 2.44 percent and Teck Resources Limited (TCK.B.TO) added 1.02 percent.

The Capped Industrials Index gained 0.71 percent, with Bombardier Inc. (BBD.B.TO) up 0.79 percent and Air Canada (AC.A.TO) up 2.0 percent.

The Capped Telecommunications Index slipped 0.27 percent, with Rogers Communications Inc. (RCI.B.TO) adding 0.79 percent, Manitoba Telecom Services Inc. (MBT.TO) down 0.16 percent, Telus Corp. (T.TO) down 0.55 percent, and BCE Inc. (BCE.TO) shedding 0.74 percent.

The Information Technology Index moved up 0.10 percent, with BlackBerry Limited (BB.TO) up 2.17 percent. Avigilon Corp. (AVO.TO) dived 11.33 percent after reporting a decline in net income for the second quarter, although revenue surged 66 percent and adjusted earnings improved.

The Capped Utilities Index dipped 0.07 percent with Fortis Inc. (FTS.IR.TO) declining 0.72 percent.

Brookfield Asset Management Inc. (BAM.A.TO) gained 1.19 percent after reporting second-quarter 2014 funds from operations of $569 million and $0.84 per share, up from from $464 million and $0.68 per share a year ago.

Magna International Inc. (MG.TO) shares added 6.12 percent after the company reported second-quarter net income of $510 million, up from the prior year's $415 million. Earnings per share improved to $2.32 from $1.78 last year.

Stella-Jones Inc. (SJ.TO) shares jumped 6.82 percent after reporting second-quarter net income of $28.8 million or $0.42 per share, compared to $26.4 million or $0.38 cents per share a year ago.

Power Financial Corp. (PWF.TO) added 0.38 percent after reporting second-quarter net earnings attributable to common shareholders of C$568 million or C$0.80 per share, up from C$475 million or C$0.67 per share last year.

On the economic front, a report from Statistics Canada showed unemployment to have declined by a more than expected 7.0 percent (seasonally adjusted) in July, from 7.1 percent in June.

In economic news from the U.S., labor productivity rose by a more than anticipated 2.5 percent in the second quarter, data released by the Labor Department showed. Economists expected an increase of 1.5 percent.

Unit labor costs were up 0.6 percent in the second quarter, notably lower than expectations for a 1.4 percent growth.

Wholesale inventories in the U.S. climbed by 0.3 percent in June, matching the downwardly revised increase seen in May. Economists had been expecting inventories to increase by about 0.6 percent compared to the 0.5 percent growth originally reported for the previous month.

The weaker than expected growth came as a 0.7 percent increase in inventories of durable goods was partly offset by a 0.2 percent drop in inventories of non-durable goods.

Wholesale sales in the U.S. inched up by just 0.2 percent in June following a 0.7 percent increase in May.

China's exports grew 14.5 percent year-on-year in July, more than double the 7.2 percent increase seen in June, the General Administration of Custom showed Friday. Shipments were expected to increase 7 percent. Meanwhile, imports declined 1.6 percent, reversing the 5.5 percent increase in June and confounded expectations for a 2.6 percent rise.

The Bank of Japan unanimously decided to maintain status quo position with respect to its monetary policy, the central bank stated on Friday after its two-day monetary policy meet. The central bank said it will continue to increase the monetary base at an annual pace of about JPY 60 trillion to JPY 70 trillion.