TSX Ends Higher Ahead Of Fed Meet Outcome -- Canadian Commentary

(RTTNews) - Canadian stocks moved up to end higher on Tuesday, led by gains in the financial, materials, and healthcare stocks, ahead of the two-day U.S. Federal Reserve policy meet even as the volatile situation in Iraq and Ukraine continued raise concerns while limiting gains.

Investors also weighed some soft economic data from the U.S. with both annual inflation rate to its highest since late 2012 and housing starts also declining more than expected.

The benchmark index continued to flirt with a new all-time closing high, led by gains in technology, financial and consumer discretionary stocks.

However, investors remained cautious ahead to the outcome of the two-day U.S. Federal Reserve meeting that will conclude on Wednesday. It is widely expected the central bank will cut its bond purchasing program by $10 billion to $35 billion a month.

The S&P/TSX Composite Index closed Tuesday at 15,055.89, up 15.46 points or 0.10 percent. The index scaled an intraday high of 15,074.74 and a low of 15,006.37.

Crude oil ended lower with easing concerns over Iraq and on some soft economic data out of the U.S., ahead to the official inventories data and the two-day Federal Reserve policy meet.

The Energy Index dropped 0.61, with U.S. crude oil futures for July delivery, the most actively traded contract, dropping $0.54 or 0.5 percent to close at $106.36 a barrel Tuesday on the Nymex.

Among energy stocks, Canadian Natural Resources Ltd. (CNQ.TO) shed 0.73 percent, Talisman Energy Inc. (TLM.TO) down 1.12 percent, and Suncor Energy Inc.(SU.TO) dropped 0.92 percent. Cenovus Energy Inc. (CVE.TO) surrendered 0.64 percent, while Encana Corporation (ECA.TO) added 0.19 percent.

The Financial Index gained 0.32 percent with Royal Bank of Canada (RY.TO) up 0.08 percent, Bank of Montreal (BMO.TO) up 0.21 percent, Toronto-Dominion Bank gained 0.48 percent, and the Canadian Imperial Bank of Commerce (CM.TO) was up 0.21 percent. Bank of Nova Scotia (BNS.TO) dipped 0.08 percent, with National Bank of Canada (NA.TO) dropping 0.17 percent.

The Capped Healthcare Index gained 0.46 percent with Extendicare Inc. (EXE.TO) adding 0.27 percent, while Valeant Pharmaceuticals International, Inc. (VRX.TO) gained 1.22 percent after indicating plans to take its offer for Allergan Inc. (AGN) directly to the shareholders this week, after the Botox maker repeatedly rejected its acquisition proposals.

The Global Gold Index added 0.62 percent, although gold futures for August delivery dropped $3.30 or 0.3 percent to close at $1,272.00 an ounce Tuesday on the Nymex.

Seabridge Gold Inc.(SEA.TO) gained 9.97 percent after entering into a comprehensive Benefits Agreement with the Nisga'a Nation in respect of its KSM Project located in northwest British Columbia.

Among other gold stocks, B2Gold Corp. (BTO.TO) shed 0.72 percent, Yamana Gold Inc. (YRI.TO) dropped 0.90 percent, Barrick Gold Corp. (ABX.TO) added 0.93 percent, and Kinross Gold Corp. (K.TO) dipped 0.45 percent.

The Capped Materials Index gained 0.53 percent, with Potash Corp. of Saskatchewan Inc. (POT.TO) up 1.99 percent.

The Diversified Metals & Mining Index ended flat, with Lundin Mining Corp. (LUN.TO) up 0.53 percent, First Quantum Minerals Ltd. (FM.TO) down 1.62 percent, and Teck Resources Limited (TCK.B.TO) up 0.30 percent.

The Information Technology Index edged up 0.08 percent, with BlackBerry Limited (BB.TO) up 1.86 percent, CGI Group Inc. (GIB.A.TO) up 0.13 percent, Constellation Software Inc. (CSU.TO) slipped 2.28 percent, Descartes Systems Group Inc. (DSG.TO) gained 2.20 percent, and Avigilon Corporation (AVO.TO) added 2.31 percent.

The Capped Industrials Index dipped 0.62 percent, with Bombardier Inc. (BBD.B.TO) down 1.28 percent and Air Canada (AC.B) surrendered 0.31 percent.

In economic news from the U.S., data from the Commerce Department showed housing starts to have declined 6.5 percent to an annual rate of 1.001 million in May, after jumping 12.7 percent to a rate of 1.071 million in April. Economists expected housing starts to drop to a rate of 1.030 million.

Meanwhile, building permits dropped 6.4 percent to an annual rate of 991,000 in May from the downwardly revised April rate of 1.059 million.

A report from the Labor Department showed consumer prices in U.S. to have risen by a more than expected 0.4 percent in May, up from 0.3 percent in April. Economists expected the index to edge up by about 0.2 percent. Higher prices for food, shelter, electricity, airline fares, and gasoline all contributed to the bigger than expected increase of the index.

In economic news from the eurozone, labor cost grew at a slower annual pace in the first three months of the year, rising 0.9 percent year-on-year, following a 1.6 percent gain in the fourth quarter last fiscal.

Meanwhile, U.K. inflation eased to a 55-month low of 1.5 percent in May, following a fall in transport and food costs. U.K. house price inflation accelerated in April, rising 9.9 percent annually, compared to an 8 percent rise in March.