Canadian stocks were extending gains for a third session Tuesday morning as hopes for central bank stimulus resurfaced after Spanish and Italian bond yields surged to record high in the previous session. Also, steady commodities helped lift trader sentiment, with their focus shifting to a two-day FOMC meeting.
The S&P/TSX Composite Index rose 127.90 points or 1.10 percent to 11,729.03, after adding nearly 150 points or just over 1 percent in the past two sessions.
The price of crude oil was moving higher Tuesday morning as traders focus over the developments in the euro zone after Greek leaders said they would form a group to renegotiate the agreed austerity measures. Today after the market hours, the API will release its U.S. crude oil inventories report for the weekended June 15. Analysts expect crude oil inventories to decline by 1.0 million barrels and gasoline stocks to increase by 1 million barrels last week. Crude for July gained $0.91 to $84.18 a barrel.
In the oil patch, Cenovus Energy (CVE.TO) and Tourmaline Oil (TOU.TO) gained nearly 4 percent each, while Ecopetrol S.A. (ECP.TO) and Vermilion Energy (VET.TO) adding around 2 percent each.
Among financial plays, TD Bank (TD.TO), National Bank (NA.TO) and Scotiabank (BNS.TO) gathered over 1 percent each.
Fuel cell products maker Ballard Power Systems (BLD.TO) revised down its 2012 guidance assuming there are no bus module shipments to Brazil until 2013. Accordingly, the company now guides revenue of $85 million, down from earlier $100 million, and adjusted EBITDA of about negative $5 million, compared to a breakeven earlier. Interestingly, the stock surged over 5 percent.
Meanwhile, gold stocks were trading lower even as the prices of bullion was firm. The price of gold was steady around its two-week high Tuesday morning as the U.S. dollar was mixed ahead of the 2-day FOMC meeting. Gold for August edged down $1.30 to $1,625.70 an ounce.
Among gold plays, Allied Nevada Gold (ANV.TO), Barrick Gold (ABX.TO), Seabridge Gold (SEA.TO) and Goldcorp. (G.TO) surrendered around 2 percent each.
Commercial real estate company Brookfield Office Properties Inc. (BPO.TO) eased 0.50 percent after it said it would buy a portfolio of premier office buildings and a development site in the London financial district from Hammerson Plc (HMSO.L) for $829 million.
Cable maker Belden Inc. (BDC) announced that through its wholly-owned subsidiary, it has commenced its offer to acquire all of the outstanding common shares of Miranda Technologies Inc. (MT.TO) for C$17.00 per share in cash. Shares of Miranda edged up 0.25 percent.
In economic news, Statistics Canada said wholesale sales rose 1.5 percent in April to $49.3 billion, largely helped by higher sales in the agricultural supplies industry. Excluding this industry, wholesale sales were unchanged.
From the U.S., the Commerce Department put the number of privately owned housing starts at a seasonally adjusted annual rate of 708,000 for May. While the May figure is 4.8 percent below the revised April estimate of 744,000, much of that drop comes as a result of revised figures that put the April rebound in housing starts notably higher than the 717,000 rate initially reported. The revised figures put the April housing starts at the highest rate since October 2008. Nevertheless, most economists had hoped to see at least a small continuation of the growth in May, forecasting an annual rate of housing starts at 720,000.
From the euro zone, U.K. annual inflation slowed unexpectedly in May to the lowest since November 2009, the Office for National Office said. Annual inflation eased to 2.8 percent, largely due to the slower increases in food and non-alcoholic beverage prices. Economists were expecting the rate to remain unchanged at 3 percent in May. Nonetheless, inflation continues to hover above the 2 percent target.
Meanwhile, survey results published by the Center For European Economic Research (ZEW) showed that German economic expectations declined more than expected in June. The ZEW Indicator of Economic Sentiment for Germany decreased by 27.7 points to a level of minus 16.9 points in June. This is the indicator's strongest decline since October 1998. Economists had forecast a decline to 2.3.
by RTT Staff Writer
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