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Stocks Are Climbing After Interest Rates Unchanged - Canadian Commentary

The Canadian stock market is climbing in early trade Wednesday on broad strength. The Canadian sectors are green across the board, with energy stocks among the top performers.

As expected, the Bank of Canada held its benchmark interest rate unchanged at 1.75%. In October, the bank had raised interest rate by 25 basis points.

Markets in Europe are trading firmly in the red Wednesday, adding to yesterday's losses. There is skepticism and confusion about the truce between the U.S. and China on trade after China promised action but gave no details on the tentative truce. Brexit-related uncertainty is also weighing on sentiment after Theresa May's government suffered three successive defeats in the British Parliament on Tuesday.

Markets on Wall Street are closed Wednesday for a national day of mourning after the death of former U.S. President George H.W. Bush.

The benchmark S&P/TSX Composite Index is up 173.51 points or 1.15 percent at 15,237.10.

On Tuesday, the index closed down by 211.39 points or 1.38 percent, at 15,063.59. The index scaled an intraday high of 15,259.34 and a low of 15,047.06.

The Energy Index is rising 1.75 percent. Cenovus Energy (CVE.TO) is increasing 1.02 percent and Crescent Point Energy (CPG.TO) is gaining 3.14 percent. Encana (ECA.TO) is up 1.34 percent and Suncor Energy (SU.TO) is climbing 2.18 percent. Imperial Oil (IMO.TO) is advancing 2.27 percent and Enbridge (ENB.TO) is adding 1.65 percent.

The Capped Industrials Index is up 1.62 percent. Air Canada (AC.TO) is climbing 1.19 percent and WestJet Airlines (WJA.TO) is rising 1.73 percent. Canadian Pacific Railway (CP.TO) is higher by 2.20 percent and Canadian National Railway (CNR.TO) is increasing 2.60 percent. Finning International (FTT.TO) is gaining 1.83 percent and Bombardier (BBD-B.TO) is adding 2.83 percent.

The heavyweight Financial Index is increasing 1.08 percent. Royal Bank of Canada (RY.TO) is advancing 1.35 percent and Bank of Nova Scotia (BNS.TO) is rising 1.30 percent. Canadian Imperial Bank of Commerce (CM.TO) is higher by 0.74 percent and Bank of Montreal (BMO.TO) is up 0.53 percent. Toronto-Dominion Bank (TD.TO) is adding 1.03 percent.

National Bank of Canada (NA.TO) is climbing 1.43 percent after it reported an 8% increase in fourth quarter net profit, at $566 million, compared to year-ago quarter. The bank also announced that its Board has declared an increase in dividend of 3 cents per common share to C$0.65 per common share for the quarter ending January 31, 2019, up 5% from the previous quarter.

The Capped Information Technology Index is gaining 1.01 percent. Constellation Software (CSU.TO) rising 0.84 percent and Descartes Systems Group (DSG.TO) is adding 0.08 percent. BlackBerry (BB.TO) is climbing 2.51 percent.

The Capped Materials Index is up 0.97 percent. Agnico Eagle Mines (AEM.TO) is rising 0.18 percent and Nutrien (NTR.TO) is climbing 2.89 percent.

The Capped Telecommunication Services Index is up 0.82 percent. TELUS (T.TO) is gaining 0.67 percent and BCE (BCE.TO) is higher by 0.65 percent. Rogers Communications (RCI-B.TO) is rising 0.43 percent.

The Gold Index is increasing 0.54 percent. Yamana Gold (YRI.TO) is advancing 0.35 percent and Goldcorp (G.TO) is climbing 0.40 percent. Barrick Gold (ABX.TO) is higher by 0.29 percent.

Thomson Reuters Corp. (TRI.TO) is up 0.13 percent after it announced the company plans FTE, or full time employees, reduction of approximately 12% by 2020. The company said it also plans to reduce its locations by approximately 30% and to grow its organic revenues 3.5% - 4.5% by 2020. Thomson Reuters is hosting its 2018 Investor Day in Toronto today.

Roots Corporation (ROOT.TO) is falling 20.04 percent after it reported adjusted EBITDA of $10.2 million for the third quarter of current financial year, down 37.4% from $16.3 million in the year-ago quarter. Basic Earnings Per Share was down 42% at $0.07, compared to $0.12 per share in the year-ago quarter.

Hudson's Bay Company (HBC.TO) is gaining 2.54 percent after it reported a net loss of $124 million for the third quarter, compared to net loss of $116 million in the prior year.

On the economic front, the services sector in China continued to expand in November, and at a greatly accelerated rate, the latest survey from Caixin revealed on Wednesday with a PMI score of 53.8. That beat expectations for 50.8, which would have been unchanged from the October reading. It also moves further above the boom-or-bust line of 50 that separates expansion from contraction.

Eurozone retail sales grew in October after decreasing in the previous month, preliminary data from Eurostat showed on Wednesday. Retail sales grew 0.3 percent from September, when they fell 0.5 percent, after the stagnation reported earlier was revised. Economists had forecast a 0.2 percent increase for October.

Eurozone's private sector growth was the lowest in more than two years during November, led by Germany, though the pace of slowdown was less than what was estimated initially. The final Eurozone Composite purchasing managers' index fell to 52.7 from October's 53.1, survey data from IHS Markit showed on Wednesday. The figure was slightly higher than the flash estimate of 52.4.

UK services sector growth slowed to its weakest level in nearly two-and-a-half years in November, amid weaker growth in both business activity and new work as Brexit concerns intensified, defying expectations for a modest improvement.

The CIPS UK Services purchasing managers' index, or PMI, fell to 50.4 from 52.2 in October, marking the lowest level since July 2016, survey results from IHS Markit showed on Wednesday. Economists had forecast a score of 52.5.

In commodities, crude oil futures for January delivery are up 0.45 or 0.85 percent at $53.70 a barrel.

Natural gas for January is up 0.056 or 1.26 percent at $4.513 per million btu.

Gold futures for February are down 4.10 or 0.33 percent at $1,242.50 an ounce.

Silver for January is down 0.057 or 0.39 percent at $14.495 an ounce.

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