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Higher Opening Seen For Bay Street

Canadian shares look headed for a positive start on Wednesday, tracking higher U.S. and Canadian futures and cues from Asia and Europe, amid rising optimism about the U.S. and China striking a trade deal ahead of expiry of the 90-day truce.

Rising crude oil prices too point to a higher opening for the Canadian market. Investors will also be reacting to Canada housing starts data, due at 8:15 AM ET.

At 10:00 AM ET, Bank of Canada is scheduled to announce its interest rate decision. The central bank is widely expected to hold its benchmark rate unchanged at 1.75%.

With talks getting extended to Wednesday and U.S. President Donald Trump saying in a tweet that discussions between the world's two largest economies were "going very well," investors are optimistic that a trade deal can be struck ahead of a March 1 deadline established by Trump and Chinese President Xi Jinping last month at the G-20 summit in Argentina.

Meanwhile, Beijing approved the import of five genetically modified crops on Tuesday, the first in about 18 months in a bid to boost its purchases of U.S. grains.

The market will also be following the developments with regard to the ongoing government shutdown in the U.S.

On Tuesday, the benchmark S&P/TSX Composite Index ended up 101.02 points, or 0.70%, at 14,605.15, after scaling a low of 14,533.89 and a high of 14,645.61.

In company news, Pattern Energy Group Inc. (PEGI.TO) announced the completion of sale of the Company's 90 megawatt minority owned interest in the K2 Wind power facility in Ontario for a purchase price of CAD$216.0, to a consortium of investors led by Axium Infrastructure.

Aphria Inc. (APHA:TO) today announced the completion of its previously announced acquisition of CC Pharma GmbH, a leading distributor of pharmaceutical products to more than 13,000 pharmacies in Germany, as well as throughout Europe. Aphria also announced that it has completed its first shipment of medical cannabis to Shoppers Drug Mart.

EXFO Inc. (EXF.TO) announced that its Board of Directors has authorized a share repurchase program, by way of a normal course issuer bid on the open market, of up to approximately 6.3% of the public float of subordinate voting shares. The company reported first quarter 2019 net loss of US$7.5 million, or US$0.14 per share, compared to net earnings of US$2.7 million, or US$0.05 per share, in the first quarter of 2018.

Asian markets ended on a firm note on Wednesday, buoyed by optimism that trade talks between the United States and China are progressing.

European stocks were moving higher as well. On Tuesday, U.S. President Donald Trump tweeted, "talks with China are going very well!".

On the economic front, Germany's merchandise trade surplus unexpectedly grew in November to its biggest level in five months despite weaker exports, preliminary data from the Federal Statistical Office showed. The non-adjusted trade surplus grew to EUR 20.5 billion from EUR 18.9 billion in October. Economists had expected a surplus of EUR 18.6 billion.

U.K. permanent job appointment grew at the weakest pace since early 2017 amid a sharp decline in the supply of candidates, survey data from IHS Markit showed. The KPMG/REC report on Jobs showed that weaker growth in appointments led to further marked increases in starting pay and salary inflation was the quickest in over three years.

According to the data released by Eurostat, eurozone unemployment rate unexpectedly eased in November to its lowest level in more than a decade, easing to 7.9% from 8% in October. Economists had expected the rate to remain unchanged.

The EU28 unemployment rate was 6.7% in November, unchanged from October, and the lowest since the series began in January 2000.

Meanwhile, Switzerland's consumer price inflation slowed in December to its lowest level in 10 months, figures from the Federal Statistical Office showed. The consumer price index rose 0.7% year-on-year following a 0.9% increase in November. Economists had expected a 0.8% climb.

In commodities, crude oil futures for February were rising $1.02, or 2.05%, at $50.80 a barrel.

Natural gas futures for February were up $0.033, or 1.11%, at $3.000 per million btu.

Gold futures for February were declining by $3.65, or 0.28%, at $1,282.25 an ounce.

Silver futures for March were down $0.051, or 0.32%, at $15.662 an ounce, while Copper futures for March up $0.018, or 0.68%, at $2.674 per pound.

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