TSX Ends Higher As Gold Stocks Surge - Canadian Commentary

(RTTNews) - Canadian stocks ended higher for a third straight session Thursday, led by gold stocks with investors upbeat after the sixteen-day U.S. government shutdown ended and the debt ceiling raised, indicating little likelihood of the Federal Reserve cutting down its quantitative easing program in the near future.

The fiscal uncertainties in the U.S. were resolved after both the House and the Senate passed a bill to end the sixteen-day government shutdown and raise the debt ceiling last night. The bill was later signed by President Barack Obama.

The agreement envisages funding the government through January 15 and extending the debt limit through February 7. The plan also calls on lawmakers to work toward a broader budget agreement by December 13 and includes stricter income verification for subsidies under Obamacare.

Since the shutdown and debt-ceiling talks are to continue through the year, economists believe the economic impact of the shutdown would likely see the Federal Reserve maintain its asset purchase program for the foreseeable future.

The S&P/TSX Composite Index closed Thursday at 13,035.70, up 78.49 points or 0.61 percent. The index touched an intraday high of 13,040.30 and a low of 12,951.33.

The Diversified Metals & Mining Index gained 1.13 percent, with First Quantum Minerals Ltd. (FM.TO) up 0.32 percent, Teck Resources Limited (TCK.B.TO) up 0.72 percent, and Lundin Mining Corp. (LUN.TO) gaining 0.22 percent.

The Capped Materials Index jumped 2.68 percent, with Potash Corporation of Saskatchewan Inc.(POT.TO) edging down 0.15 percent.

Gold futures ended higher Thursday, after the the sixteen-day government shutdown ended and the debt ceiling raised, indicating little likelihood of the Federal Reserve cutting down its quantitative easing program in the near future.

The Global Gold Index soared 4.72 percent, with gold futures for December delivery surging $40.70 or 3.2 percent to close at $1,323.00 an ounce Thursday on the Nymex.

Among gold stocks, Yamana Gold Inc. (YRI.TO) added 2.49 percent, while Barrick Gold Corp. (ABX.TO) jumped 4.55 percent. Goldcorp Inc. (G.TO) added 3.48 percent, while Kinross Gold Corp. (K.TO) gained 3.70 percent. Eldorado Gold Corp. (ELD.TO) surged 9.25 percent.

Crude oil plummeted to end at a near 14-week low Thursday, on demand growth uncertainties, with some industry data showing U.S. crude oil stockpiles to have jumped more than expected last week.

The Energy Index gained 0.09 percent, although U.S. crude oil futures for November delivery plummeting $1.62 or 1.6 percent to close at $100.67 a barrel Wednesday on the Nymex.

Among energy stocks, Suncor Energy Inc.(SU.TO) slipped 0.05 percent, while Enbridge Inc.(ENB.TO) edged up 0.12 percent. Imperial Oil Limited (IMO.TO) slipped 0.02 percent, while Talisman Energy Inc. (TLM.TO) added 0.16 percent.

The Financial Index added 0.50 percent with Bank of Montreal (BMO.TO) adding 0.62 percent, while Manulife Financial Corp. (MFC.TO) edged up 0.34 percent. The Bank of Nova Scotia (BNS.TO) gained 1.01 percent, while Toronto-Dominion Bank (TD.TO) added 0.22 percent. Royal Bank of Canada (RY.TO) moved up 0.50 percent, while National Bank of Canada (NA.TO) gathered 0.94 percent.

The Information Technology Index surrendered 1.05 percent, although smartphone maker BlackBerry Limited (BB.TO) up 0.24 percent.

The Capped Industrials Index dipped 0.03 percent, with Bombardier Inc. (BBD.A.TO, BBD.B.TO) up 0.20 percent and Air Canada (AC.B.TO) down 0.60 percent.

Mineral exploration and development company Energizer Resources Inc (EGZ.TO) jumped 12% after the commission and start up of the pilot plant for its flagship Molo Graphite Project in Madagascar.

In economic news, Statistics Canada said non-resident investment in Canadian securities slowed to $2.1 billion in August, with focus turning toward corporate debt instruments. Meanwhile, Canadian investment in foreign securities rose to $5.7 billion, recording its the largest gain since November 2012.

In economic news from the U.S, the Labor Department said initial jobless claims fell to 358,000 in the weekended October 12, a decrease of 15,000 from the previous week's revised figure of 373,000. Economists had expected jobless claims to drop to 335,000 from the 374,000 originally reported for the previous week.

Growth in Philadelphia-area manufacturing activity continued in October, although the pace of growth slowed compared to the previous month, a Federal Reserve Bank of Philadelphia report showed Thursday. The Philly Fed diffusion index of current activity dropped to 19.8 in October from 22.3 in September, with a positive reading indicating growth in regional manufacturing activity. Economists expected the manufacturing index to show a more substantial decrease to about 15.0.

Elsewhere, eurozone current account surplus increased in August due mainly to a rise in visible trade surplus, data from the European Central Bank showed. The current account surplus rose to a seasonally adjusted 17.4 billion euros in August from 15.5 billion euros in July. The surplus on trade in goods increased to 14.7 billion euros from 11.1 billion euros in the previous month.

Eurozone construction output increased at a slower pace in August, preliminary data from Eurostat showed. Construction production increased a seasonally adjusted 0.5 percent month-on-month, following a 0.7 percent gain in July and a 1.5 percent growth in June.

U.K. retail sales increased more than expected in September, data from the Office for National Statistics revealed. Retail sales volume, including automotive fuel, rose 0.6 percent month-on-month in September. This was forecast to grow 0.4 percent.