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TSX May Struggle To Sustain Gains - Canadian Commentary


Canadian stocks may struggle to sustain gains at open Monday amid faltering commodities and mixed cues from the global stock markets. Global stocks moved down amid concerns over economic growth after data revealed euro zone manufacturing faltered, while unemployment in the region rose to record in February.

U.S. stock futures were pointing to a marginally lower open.

On Friday, the S&P/TSX Composite Index snapped its three-session losing streak to add 52.82 points or 0.43 percent to 12,392.18.

The price of crude oil was lingering near its 6-week low Monday morning as traders were concerned over demand growth amid speculation about strategic-supply releases. Crude for May Shed $0.43 to $102.59 a barrel.

The price of gold was ticking lower Monday morning as the U.S. dollar was mixed ahead of this week's economic data, including non-farm payroll report. Gold for June was down $4.70 to $1,667.20 an ounce.

In corporate news from Canada, Ivanhoe Mines (IVN.TO) said it would sell its stake in Mongolian coal miner SouthGobi Resources Ltd. (SGQ.TO) to Aluminum Corporation of China Ltd., known as Chalco, for about C$900 million, or C$8.48 per share.

Base-metals miner Imperial Metals (III.TO) reported fiscal 2011 net income of C$48.7 million or C$0.66 per share, up from C$38.4 million or C$0.53 per share in the prior-year period. However, adjusted net income was C$31.33 million or C$0.42 per share down from C$45.70 million or C$0.63 per share a year ago. Analysts were expecting the company to report earnings of C$0.61 per share for the period.

Oil and gas industry services provider Enterprise Oilfield Group (E.TO) swung to profit in fourth quarter, reporting net income of C$0.9 million compared to a net loss of C$3.6 million in the year ago quarter.

Equipments solutions provider Hyduke Energy Services (HYD.TO) turned to black in fourth quarter, reporting profits of C$1.1 million or C$0.04 per share compared to a loss of $1.8 million or $0.07 per share last year.

Photovoltaic energy products company Day4 Energy (DFE.TO) reported a wider fourth quarter net loss of $18.8 million or $0.39 per share, compared to a loss of $1.3 million or $0.04 per share in the year-ago period.

Precious metals miner High River Gold Mines (HRG.TO) reported full year 2011 net income of C$170.4 million or C$0.20 per share, up from C$111.7 million or C$0.13 per share in the prior year.

Diversified natural resource company Mercator Minerals (ML.TO) reported that its fourth quarter net loss narrowed to C$32.9 million or C$0.13 per basic share from C$80.0 million or C$0.41 per basic share in the previous year quarter. Adjusted net income declined to C$1.5 million or breakeven per share from C$8.1 million or C$0.04 per basic share in the prior year quarter.

West Africa focused gold miner Avion Gold Corp. (AVR.TO) reported lower fourth quarter net income of $8.07 million or $0.02 per share compared to $20.39 million or $0.05 per share in the year-ago quarter.

In economic news, euro zone manufacturing downturn worsened as initially estimated in March, final data from Markit Economics showed. The Purchasing Managers' Index fell to 47.7 in March, a three month low, from 49 in the previous month. The final reading matched flash estimate.

Meanwhile, unemployment rate in the euro zone rose to a new record high in February, data from Eurostat showed. The seasonally adjusted jobless rate rose to 10.8 percent from 10.7 percent in January. The outcome was in line with economists' forecast. The rate was 10 percent in February 2011.

A separate report from the Markit Economics showed that German manufacturing sector contraction in March was less severe than estimated earlier. The seasonally adjusted Markit/BME purchasing managers' index fell to 48.4 in March from 50.2 in February.

by RTTNews Staff Writer

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