TSX Ends Higher On Earnings, China Data -- Canadian Commentary

(RTTNews) - Canadian stocks ended at a two-week high Wednesday, on an upbeat manufacturing data from China and some encouraging earnings results from major banks. The main index was also helped by a surge in real estate company Hudson's Bay shares and an uptick in the energy sector as crude prices soared. However, the gains were somewhat capped by some declining healthcare and consumer staples stocks.

Markets in Europe ended largely in negative territory, due mainly to some profit taking after recent gains brought most European markets to new highs.

Markets in the United States are also ended lower, with profit taking responsible for some weakness on Wall Street following the uptick seen over the past several weeks. Trading activity has been somewhat subdued, as Federal Reserve Chair Janet Yellen on the second day of her congressional testimony.

In some upbeat economic news, China's manufacturing sector rebounded unexpectedly in February with the purchasing managers' index rising to its highest level in four months, flash figures from Markit Economics showed Wednesday.

Meanwhile, a Commerce Department report on Wednesday showed new home sales in the U.S. to have come above economist estimates in January, following a recent string of largely disappointing housing data.

The benchmark S&P/TSX Composite Index closed Wednesday at 15,228.57, up 63.60 points or 0.42 percent. The index scaled an intraday high of 15,258.85 and a low of 15,155.11.

On Tuesday, the index closed down 35.29 points or 0.23 percent, at 15,164.97. The index scaled an intraday high of 15,274.99 and a low of 15,150.70.

The heavyweight Financial Index gained 1.26 percent, as Bank of Montreal (BMO.TO) added 1.50 percent, Toronto-Dominion Bank (TD.TO) moved up 1.24 percent, Bank of Nova Scotia (BNS.TO) gathered 1.01 percent, and Canadian Imperial Bank of Commerce (CM.TO) rising 0.79 percent.

Royal Bank of Canada (RY.TO) jumped 3.66 percent, with the banking giant reporting first quarter adjusted earnings of C$1.67 per share and topped the consensus estimate of C$1.58 per share.

National Bank of Canada (NA.TO) soared 3.26 percent, after reporting first quarter adjusted earnings of C$1.14 per share, compared to C$1.09 per share a year ago. Analysts expected earnings of C$1.12 for the quarter.

First National Financial Corp. (FN.TO) shed 2.26 percent after its profit for the fourth quarter dropped to $0.27 per share from $0.66 per share a year ago. Revenue declined 1.3% to $198.3 million from $200.9 million last year.

Crude oil ended sharply higher as the dollar weakened against a basket of some select currencies even as the official weekly oil report showed crude stockpiles to have surged much more than expected last week. Nevertheless, oil found support with gasoline and heating fuel stocks declining more than anticipated.

The weekly report from the U.S. Energy Information Administration showed U.S. crude oil inventories to have jumped 8.4 million barrels in the week ended February 20, while analysts expected an increase of 3.7 million barrels. The report showed U.S. crude oil inventories at 434 million barrels end last week.

Gasoline stocks dropped by 3.1 million barrels last week, with analysts anticipating a decline of 1.0 million barrels. Inventories of distillate, including heating fuel, declined 2.7 million barrels, even as analysts estimated a drop of 2.8 million.

The Energy Index added 0.75 percent with U.S. crude oil futures for April delivery, surging $1.71 or 3.5 percent to settle at $50.99 a barrel on the New York Mercantile Exchange Wednesday.

Among energy stocks, Pacific Rubiales Energy Corp. (PRE.TO) gained 3.11 percent, Canadian Oil Sands (COS.TO) gathered 1.57 percent, and Penn West Petroleum Ltd. (PWT.TO) jumped 8.80 percent.

Canadian Natural Resources Limited (CNQ.TO) inched up 0.19 percent, while Crescent Point Energy Corp. (CPG.TO) dipped 0.35 percent. Cenovus Energy Inc. (CVE.TO) moved up 0.50 percent, while Talisman Energy (TLM.TO) dropped 0.72 percent.

Encana Corp. (ECA.TO) added 0.92 percent, after reporting fourth quarter operating earnings of $0.05 per share, from $0.31 per share last year.

Gold futures ended lower, but came off off their lows for the day after Federal Reserve Chief Janet Yellen's testimony before the Congress, which analysts see as less damaging to the precious metal.

The Gold Index added 1.02 percent, with gold for April delivery shedding $4.20 or 0.4 percent to settle at $1,201.50 an ounce on the New York Mercantile Exchange Wednesday.

Among gold stocks, Yamana Gold (YRI.TO) gained 0.99 percent and Goldcorp (G.TO) moved up 0.41 percent. IAMGOLD (IMG.TO) gathered 2.12 percent and Barrick Gold (ABX.TO) added 1.02 percent. Eldorado Gold (ELD.TO) gained 1.20 percent.

The Capped Materials Index moved up 0.62 percent, with Potash Corp. of Saskatchewan Inc. (POT.TO) down 0.11 percent and Agrium Inc. (AGU.TO) gained 1.26 percent.

The Diversified Metals & Mining Index moved up 0.23 percent, as Sherritt International Corp. (S.TO) gained 1.60 percent, First Quantum Minerals Ltd. (FM.TO) fell 0.98 percent, Teck Resources (TCK-B.TO) added 0.52 percent, and HudBay Minerals (HBM.TO) gathered 1.15 percent. Finning International Inc. (FTT.TO) gained 1.41 percent, while Lundin Mining Corp. (LUN.TO) dropped 1.44 percent.

The Health Care Index declined 1.49 percent, with Valeant Pharmaceuticals International, Inc. (VRX.TO) dropping 2.49 percent.

Among other healthcare stocks, Extendicare Inc. (EXE.TO) shed 0.58 percent, and Catamaran Corp. (CCT.TO) down 0.20 percent.

The Capped Industrials Index moved up 0.32 percent, with Bombardier Inc. (BBD.B.TO) soaring 4.0 percent and Air Canada (AC.TO) dropping 1.02 percent.

The Information Technology Index added 0.40 percent, as BlackBerry Limited (BB.TO) gained 2.03 percent, Constellation Software (CSU.TO) moved up 0.18 percent, and Descartes Systems Group Inc. (DSG.TO) shed 0.57 percent.

The Capped Telecommunication Index surrendered 0.10 percent, with BCE down 0.53 percent, TELUS Corp. (T.TO) up 0.45 percent, and Rogers Communications Inc. (RCI.B.TO) dipping 1.32 percent.

Hudson's Bay (HBC.TO) surged 19.74 percent, after entering into agreements with Simon Property Group Inc. (SPG) and RioCan Real Estate Investment Trust (REI.UN_TO) to form two joint ventures focused on real estate growth opportunities in the U.S. and Canada, respectively. The ventures are valued at C$4.2 billion.

Magna International (MG.TO) jumped 7.10 percent after reporting a fourth-quarter profit of $2.44 per share, compared to $2.03 per share in the prior year. Analysts expected earnings of $2.25 per share for the quarter.

On the economic front, a Commerce Department report on Wednesday showed U.S. new home sales to have come in well above economist estimates in January, following a recent string of largely disappointing housing data. New home sales in January dipped by just 0.2 percent to an annual rate of 481,000 from the revised December rate of 482,000. While new home sales pulled back off the more than six-year high set in the previous month, the rate still far exceeded economist estimates of 470,000.

China's manufacturing sector rebounded unexpectedly in February as the PMI rose to its highest level in four months, flash figures from Markit Economics showed Wednesday. The HSBC flash manufacturing purchasing managers' index, or PMI, rose to a four-month high of 50.1 in February from 49.7 in January. Economists expected the index to come in at 49.5.

Nevertheless, China's consumer sentiment dropped marginally in February, results of a survey by MNI and Westpac showed Wednesday. The Westpac-MNI consumer sentiment index edged down to 112 in February from 112.1 in January.

France's consumer confidence rose to a near three-year high in February, signaling the economy is pushing toward a strong recovery after a slowdown at the end of 2014. The consumer confidence index rose to 92 in February from 90 in January, data from statistical office Insee showed Wednesday. This was the highest level since May 2012, when it was also 92, and exceeded the expected score of 91.

U.K. mortgage approvals increased in January for the first time since June, the British Bankers' Association reported Wednesday. Mortgage approvals for house purchases rose to 36,394 from 35,816 in the prior month. Economists had forecast a rise to 36,000. However, approvals were 20 percent lower than last January.