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Canadian Market Extending Gains; Energy Stocks Rally

The Canadian stock market was firmly up in positive territory Thursday morning, led by strong gains in the energy sections. Stocks from telecommunications, financial, consumer discretionary and industrial sectors too moved higher.

Rising optimism about the U.S. and China signing an interim trade deal this month, and higher crude oil prices contributed to the market's move up north.

A spokesman for the Chinese Commerce Ministry said the U.S. and China have agreed to lift existing tariffs in phases.

"The trade war started with tariffs and should end with the cancellation of tariffs," said ministry spokesman Gao Feng, who noted phase one of a trade deal must include both countries simultaneously canceling tariffs on each other's goods.

"Both sides have agreed to cancel additional tariffs in different phases, as both sides make progress in their negotiations," Gao added without providing a timetable.

The benchmark S&P/TSX Composite Index was up 72.72 points, or 0.43%, at 16,818.36 a few minutes past noon.

The Capped Energy Index was up more than 3.5%. Canadian Natural Resources (CNQ.TO) gained about 6% on strong results. The company reported that its third-quarter net earnings plunged to C$1.03 billion or C$0.87 per share from last year's C$1.80 billion or C$1.47 per share.

Adjusted net earnings from operations were C$1.23 billion or C$1.04 per share, compared to C$1.35 billion or C$1.11 per share a year ago.

Crescent Point Energy (CPG.TO) moved up 5.65%, ARC Resources (ARX.TO) gained 4.6%, Whitecap Resources (WCP.TO) rallied 4.3% and Tourmaline Oil Corp. (TOU.TO) advanced 4%.

Seven Generations Energy (VII.TO), MEG Energy (MEG.TO), Enerplus Corp (ERF.TO), Cenovus Energy (CVE.TO), Suncor Energy (SU.TO), Vermilion Energy (VET.TO) and Husky Energy (HSE.TO) gained 2.3 to 4%. Parex Resources (PXT.TO), Imperial Oil (IMO.TO), Encana Corp (ECA.TO) and Baytex Energy (BTE.TO) also moved up sharply.

Telecommunications stocks Telus Corp. (T.TO) and Quebecor Inc. (QBR.B.TO) gained 4.7% and 3.1%, respectively. Quebecor reported adjusted income of $173.8 million ($0.68 per basic share) for the third quarter of 2019, compared with $141.5 million ($0.61 per basic share) in the same period of 2018, an increase of $32.3 million ($0.07 per basic share) or 22.8%.

Manulife Financial Corp. (MFC.TO) gained about 3.2%. The company said its earnings totaled C$723 million, or C$0.35 per share in the third quarter of this fiscal. This compares with C$1573 million, or C$0.77 per share, in last year's third quarter. Excluding items, Manulife Financial reported adjusted earnings of C$1527 million or C$0.76 per share for the period.

Canadian Tire Corporation (CTC.TO) shares declined sharply on lower earnings in the third quarter.

In commodities, West Texas Intermediate Crude oil futures for December were gaining $1.34, or nearly 2.4%, at $57.69 a barrel.

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