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TSX Ends Marginally Lower On Eurozone Concerns - Canadian Commentary

Canadian stocks ended lower Wednesday, as bad loan issues at Spanish banks reignited concerns over the region's debt situation. Nevertheless, investors responded positively to some major acquisition deals by Canadian companies, somewhat dampened by a lackluster U.S. equity markets with some disappointing earnings.

Alimentation Couche-Tard announced plans to acquire Statoil Fuel & Retail, Norway, aiming to spread its presence in Europe, while SXC Health Solutions said it would acquire Catalyst Health Solutions in a $4.4 billion deal.

Toronto's main index, the S&P/TSX, closed Tuesday at 12,128.89, down 8.05 points or 0.07 percent. The S&P/TSX Composite Index touched an intraday high of 12,162.60 and a low of 12,077.87.

The TSX Venture Index closed at 1,411.82, a decline of 10.48 points or 0.74 percent. The index opened at 1,420.00 compared to its previous close of 1,422.30.

Major components of the S&P/TSX Index including the Materials, Energy, and the Gold Indices were in the red. Among gainers were the Financial, Health Care, Diversified Metals & Mining Indices.

Convenience stores operator Alimentation Couche-Tard (ATD_A.TO) gained over 15 percent after revealing plans to acquire Statoil Fuel & Retail ASA for NOK 53 per share cash, valuing the latter at $2.8 billion. The offer represents a premium of 52.5 percent to the Tuesday's closing price of the Statoil Fuel & Retail shares. The Capped Consumer Staples Index gathered 1.80 percent.

The Health Care Index surged 3.56 percent with pharmacy benefit management service provider SXC Health Solutions (SXC.TO) gathering over 11 percent after it said it would acquire Catalyst Health Solutions Inc. (CHSI) in a cash and stock transaction valued at about $4.4 billion.

The Metals & Mining Index gained 1.04 percent led by Ivanhoe Mines (IVN.TO) that surged over 16 percent after announcing a rights offering to holders of its common shares for about $1.8 billion in gross proceeds as part of a memorandum of agreement with majority shareholder Rio Tinto.

Among other mining issues, Teck Resources Ltd. (TCK_B.TO) was up 0.74 percent, First Quantum Minerals Ltd. (FM.TO) down 1.04 percent, and Lundin Mining Corp. (LUN.TO) was down 3.36 percent. Denison Mines Corp. (DML.TO) gathered over 6 percent after it had agreed yesterday to merge its mining assets and operations located in the US with Energy Fuels Inc. (EFR.TO).

The Financial Index gained 0.33 percent, led by TD Bank (TD.TO) shares that was up 0.45 percent, Bank of Nova Scotia (BNS.TO) advancing 0.53 percent and the Royal Bank of Canada (RY.TO) up 0.35 percent.

Smartphone maker Research In Motion (RIM.TO) dropped 1.65 percent, while transportation systems maker Bombardier (BBD.B.TO) slipped 0.73 percent.

An Energy Information Administration report revealed that US crude oil inventories jumped 3.90 million barrels, while gasoline stocks shed 3.70 million barrels in the week ended April 13. Analysts expected crude oil inventories to add 400,000 barrels and gasoline stocks to move up by 140,000 barrels last week.

Light Sweet Crude Oil futures for May delivery, dropped $1.53 or 1.5 percent to close at $102.67 a barrel on the NYMEX Wednesday.

The Energy Index dropped 0.56 percent with Bankers Petroleum Ltd. (BNK.TO) shedding 4.40 percent, Suncor Energy Inc. dropping 0.51percent, and Canadian Natural Resources Limited (CNQ.TO) down 1.38 percent. Talisman Energy Inc. (TLM.TO) edged up 0.08 percent.

Gold for June delivery shed $11.50 or 0.7 percent to close at $1,639.60 an ounce Wednesday on the NYMEX. The Global Gold Index dropped 0.91 percent.

Among gold stocks, Yamana Gold Inc. (YRI.TO) lost 1.98 percent, Eldorado Gold Corp. (ELD.TO) was down 1.88 percent, and B2Gold Corp. (BTO.TO) declined 1.79 percent. Kinross Gold Corp. (K.TO) dropped 2.35 percent, while Barrick Gold Corp. (ABX.TO) shed 0.71 percent.

The Materials Index dropped 0.90 percent, with Eastern Platinum Limited (ELR.TO) surrendering 2.70 percent and Uranium One Inc. (UUU.TO) flat with yesterday. Potash Corporation of Saskatchewan Inc. (POT.TO) dropped 1.45 percent.

Food and pharmaceutical company METRO Inc. (MRU.TO) shed 0.37 percent, despite posting second-quarter net earnings of C$96.1 million or C$0.94 per share, up from last year's C$85.7 million or C$0.82 per share.

In economic news, the eurozone current account unexpectedly logged a seasonally adjusted deficit of 1.3 billion euros in February, the European Central Bank said. Economists were expecting the surplus to fall to 2 billion euros from 3.7 billion euros surplus in January.

Meanwhile, Bank of England's Monetary Policy Committee decided to maintain the size of the asset purchase program at GBP 325 billion through a split vote as one member called for an increase in stimulus, minutes of the meeting showed today.

by RTTNews Staff Writer

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