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Canadian Shares Recovering After Mild Setback

After a positive start and a subsequent fall from higher levels, the Canadian market rebounded Thursday morning, thanks to some strong buying in materials and information technology stocks.

The mood was positive thanks to easing worries about U.S.-China trade dispute and on the European Central Bank's announcement of additional stimulus to revive euro area economic growth.

The benchmark S&P/TSX Composite Index, which dropped to 16,592.36 after opening modestly higher, recovered swiftly and was up 55.33 points, or 0.33%, at 16,666.47 a little before noon.

Eldorado Gold Corporation (ELD.TO) moved up 5.5%. First Quantum Minerals (FM.TO) gained about 4.5% and Oceanagold Corp (OGC.TO) advanced 2.8%.

Crescent Point Energy (CPG.TO) surged up 3.2%, while Whitecap Resources (WCP.TO) gained nearly 1%. Encana Corporation (ECA.TO) and Canadian Natural Resources (CNQ.TO) lost 1.1% and 1%, respectively.

Aurora Cannabis (ACB.TO) declined more than 8% on strong volumes due to weak results. The company posted a net loss of C$2.26 million on net revenue of C$98.94 million, with an adjusted Ebitda loss of C$11.7 million ($8.9 million).

Hudson's Bay (HUD.TO) reported a loss of $984 million for the second quarter, compared with a loss of $280 million in the year-ago quarter. Loss per share was $5.35 in the second quarter, as against $1.45 per share a year ago. The stock was down by about 1%.

Empire Co. (EMP.A.TO) announced it posted a profit of $130.6 million in the first quarter of this financial year, up from a profit of $95.6 million in the same quarter last year. The share declined marginally.

In economic news, new home prices in Canada dropped 0.1% for the second consecutive month in June 2019. Markets had expected prices to remain unchanged.

On the trade front, a report in Bloomberg says the Trump administration officials have discussed offering an interim trade agreement to China.

The report said the limited trade agreement would delay and even roll back some U.S. tariffs for the first time in exchange for Chinese commitments on intellectual property and agricultural purchases.

The report comes after Trump tweeted that he is temporarily delaying raising tariffs on $250 billion worth of Chinese imports as a "gesture of good will."

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