TSX Ends Higher On Upbeat China Data -- Canadian Commentary

(RTTNews) - Canadian stocks ended higher for a second straight session on Monday, after some better than expected Chinese manufacturing activity data, even as the U.S. manufacturing sector grew at its fastest pace in May.

Figures released overnight showed China's factory activity expanded at its quickest pace in five months. However, Japan's manufacturing output declined for the second consecutive month in May, while the U.S. manufacturing sector grew at its fastest this year albeit less than expected.

Base metal miners made strong gains while trimming last week's losses, with energy and financial stocks also trending higher.

The S&P/TSX Composite Index closed Monday at 14,680.76, up 76.60 points or 0.52 percent. The index scaled an intraday high of 14,680.76 and a low of 14,604.19.

The Financial Index gained 0.35 percent with the Canadian Imperial Bank of Commerce (CM.TO) up 0.50 percent, Bank of Montreal (BMO.TO) edged down 0.05 percent, National Bank of Canada (NA.TO) slipped 0.07 percent, Toronto-Dominion Bank (TD.TO) added 0.40 percent, and Bank of Nova Scotia (BNS.TO) added 0.18 percent.

Royal Bank of Canada (RY.TO) ended flat at $74.66 a share after indicating that it may invest as much as $1 billion in a hedge fund spun off from its proprietary trading business, Bloomberg reported.

The Capped Healthcare Index added 1.25 percent with Catamaran Corp. (CCT.TO) dropping 0.57 percent and Extendicare Inc. (EXE.TO) gaining 1.63 percent. Valeant Pharmaceuticals International Inc. (VRX.TO) gained 2.69 percent.

Crude oil ended lower with investors opting for the riskier equity assets even as the dollar trended lower against some major currencies, amid some positive Chinese manufacturing data.

The Energy Index added 0.77 percent, although U.S. crude oil futures for July delivery, the most actively traded contract, dropped $0.24 or 0.2 percent to close at $102.47 a barrel Monday on the Nymex.

Among other energy stocks, Encana Corp. (ECA.TO) gained 0.67 percent, while Husky Energy Inc. (HSE.TO) moved up 0.80 percent. Canadian Natural Resources Ltd. (CNQ.TO) rose 0.93 percent, and Enbridge Inc. (ENB.TO) was up 0.59 percent. Baytex Energy Corp. (BTE.TO) moved up 1.32 percent, and Pacific Rubiales Energy Corp. (PRE.TO) jumped 2.64 percent.

Gold futures ended lower with investors opting for the riskier equity assets tracking rising global equity markets, even as the dollar trended higher against some major currencies..

The Global Gold Index shed 0.64 percent, with gold futures for August delivery dropping $2.00 or 0.2 percent to close at $1,244.00 an ounce Monday on the Nymex.

Among gold stocks, Yamana Gold Inc. (YRI.TO) added 0.74 percent, Osisko Mining Corp. (OSK.TO) gained 1.51 percent, Barrick Gold Corp. (ABX.TO) shed 1.48 percent, and Agnico Eagle Mines Limited (AEM.TO) moved up 0.67 percent.

The Capped Materials Index fell 0.27 percent, with Potash Corp. of Saskatchewan Inc. (POT.TO) down 0.94 percent.

The Diversified Metals & Mining Index gained 1.47 percent, with Lundin Mining Corp. (LUN.TO) surging 3.87 percent, First Quantum Minerals Ltd. (FM.TO) up 0.33 percent, and Teck Resources Limited (TCK.B.TO) adding 1.37 percent.

The Information Technology Index dropped 0.78 percent, with BlackBerry Limited (BB.TO) down 2.42 percent, Constellation Software Inc (CSU.TO) added 0.61 percent, Celestica Inc. (CLS.TO) slipped 0.08 percent, and Avigilon Corp. (AVO.TO) dived 1.07 percent.

The Capped Industrials Index added 0.61 percent, with Bombardier Inc. (BBD.B.TO) down 1.36 percent and Air Canada (AC.B) gained 2.26 percent.

In corporate news from Canada, trucking company TransForce Inc (TFI.TO) slipped 1.52 percent after indicating it would buy truckload transport and logistics company Transport America for $310 million.

Canadian Pacific (CP.TO) gained 1.95 percent after a ratings boost from Morgan Stanley, which raised its target to C$198 from C$192.

In economic news, U.S. manufacturing sector in May grew at its fastest pace this year, with the purchase managers index rising to 55.4 percent from 54.9 percent in April, according to a report from the Institute for Supply Management. Economists expected the index at 55.8 percent for May.

Showing signs of a stabilizing economy, China's manufacturing sector growth accelerated in May, to its highest level this year, data from the National Bureau of Statistics and the China Federation of Logistics and Purchasing showed Sunday. China's purchasing managers' index for May improved to 50.8 from 50.4 in April, showing signs of a pickup in the manufacturing sector and the economy -- the third consecutive monthly growth. Economists had forecast the index at 50.6 for May.

Construction spending in the U.S. rose less than expected in April, with spending edging up 0.2 percent to an annual rate of $953.5 billion from the revised March estimate of $951.6 billion. Economists expected spending to increase by about 0.6 percent. Nonetheless, the report also showed notable upward revisions to the spending seen in the two previous months. Construction spending rose 0.6 percent in March and 0.4 percent in February.

Germany's inflation slowed more than expected in May to its lowest since June 2010, flash estimates published by Destatis revealed Monday. Inflation, based on the consumer price index, dropped to 0.9 percent in May, the level last seen in June 2010, from 1.3 percent in April. This was also below the expected rate of 1.1 percent.

The harmonized index of consumer prices rose only 0.6 percent on a yearly basis in May. Inflation was expected to slow marginally to 1 percent from 1.1 percent seen in April. Month-on-month, consumer prices were down 0.1 percent, against expectations for a 0.1 percent rise. Similarly, harmonized prices slipped 0.3 percent, instead of a 0.1 percent rise forecast by economists.