Canadian Stocks Rally On China Data -- Canadian Commentary

(RTTNews) - Canadian stocks are higher on Wednesday, with better than expected Chinese growth data lifting sentiment. A positive display by stocks on Wall Street on the back of an encouraging industrial production report and upbeat tech earnings.

However, a slightly lower than expected rise in U.S. housing starts and worries about the unrest in Ukraine appear to be capping gains to an extent.

As widely expected, Bank of Canada decided to hold interest rates unchanged at 1 percent.

Tracking higher gold and crude oil prices, shares from materials and energy sectors are moving up. Industrial, information technology and telecom stocks are also higher.

The benchmark S&P/TSX Composite Index is up 78.45 points or 0.55 percent at 14,382.37.

On Tuesday, the index closed up 19.49 points or 0.14 percent at 14,303.92, coming off the day's low of 14,224.85.

In corporate news, Agnico Eagle Mines Limited (AEM.TO), Yamana Gold Inc. (YRI.TO) and Osisko Mining Corp. (OSK.TO) announced Wednesday that they have entered into an agreement by which Agnico Eagle and Yamana will jointly acquire 100% of Osisko's issued and outstanding common shares for total consideration of approximately C$3.9 billion, or C$8.15 per share.

Osisko Mining Corp. is up over 6 percent. Meanwhile, shares of Agnico Eagle Mines Limited and Yamana Gold Inc. are down 6 percent and 3.5 percent, respectively.

IMAX Corp. (IMX.TO) and TCL Multimedia Technology Holdings Ltd. have announced a joint-venture partnership with Wasu Digital TV Media Group (WASU) as part of their IMAX TCL home theatre initiative. Imax Corp. shares are up 0.6 percent.

Metro Inc. (MRU.TO) is up 3.3 percent after the company reported better than expected earnings of C$1.07 per share from continuing operations for the quarter ended March 15, although that was significantly down from the high earnings it had posted in the same quarter last year.

TransAlta Corp (TA.TO) announced on Tuesday that it has been selected as the preferred bidder to build the natural-gas fired generating station in South Hedland, Western Australia. The stock is up marginally.

Among energy stocks, Precision Drilling Corporation (PD.TO) is up nearly 4 percent, Raging River Exploration Inc. (RRX.TO) is up 2.8 percent and Advantage Oil & Gas Ltd. (AAV.TO) is rising 2.3 percent.

Legacy Oil + Gas Inc. (LEG.TO), Canadian Natural Resources Limited (CNQ.TO), Encana Corporation (ECA.TO) and Crescent Point Energy Corp. (CPG.TO) are up 1 to 1.6 percent.

Suncor Energy Inc. (SU.TO), Cenovus Energy Inc. (CVE.TO), Canadian Oil Sands Limited (COS.TO) andTalisman Energy Inc. (TLM.TO) are modestly higher.

In the diversified materials space, Teck Resources Limited (TCK.B.TO), Turquoise Hill Resources Ltd. (TRQ.TO), HudBay Minerals Inc. (HBM.TO), Sherritt International Corporation (S.T), and Nevsun Resources Ltd. (NSU.TO) are up 1 to 2 percent.

Meanwhile, First Quantum Minerals Ltd. (FM.TO) and Major Drilling Group International Inc. (MDI.TO) are up 0.5 percent and 0.8 percent, respectively.

Among gold stocks, Detour Gold Corporation (DGC.TO), Goldcorp Inc. (G.TO) and New Gold Inc. (NGD.TO) are up 1 to 2 percent. Kinross Gold Corporation (K.TO) is modestly higher, while orex Gold Resources Inc. (TXG.TO) is climbing more than 6 percent.

In the technology space, CGI Group Inc. (GIB.A.TO), Open Text Corporation (OTC.TO), Constellation Software Inc. (CSU.TO) and Avigilon Corporation (AVO.TO) are up 0.5 to 1 percent, while Celestica Inc. (CLS.TO) is adding 1.8 percent.

Among industrial stocks, Canadian Pacific Railway Limited (CP.TO), SNC-Lavalin Group Inc. (SNC.TO), CAE Inc. (CAE.TO) and Progressive Waste Solutions Ltd. (BIN.TO) are moving up 0.4 to 1 percent, while Finning International Inc. (FTT.TO) and Canadian National Railway Company (CNR.TO) are up 2 percent and 1.6 percent, respectively.

Among healthcare stocks, Extendicare Inc. (EXE.TO) is modestly higher and Catamaran Corporation (CCT.TO) is down 0.4 percent, while Valeant Pharmaceuticals International, Inc. (VRX.TO) is little changed.

Among big six banks, Toronto-Dominion Bank (TD.TO), Bank of Nova Scotia (BNS.TO), Canadian Imperial Bank Of Commerce (CM.TO) and National Bank of Canada (NA.TO) are modestly higher.

Among other notable movers, Air Canada (AC.B.TO) is up 2 percent,

In commodities, crude oil prices gave up some early gains after the data from the U.S. Energy Information Administration showed crude stockpiles to have climbed 10 million barrels to 394.1 million barrels in the week ended April 11.

Crude oil futures for May delivery are up $0.61 or 0.59 percent at $104.36 a barrel, off a seven-week high of $104.98 a barrel it touched earlier in the day.

Investors are looking ahead to the official crude oil inventory data from the Energy Information Administration, due at 10:30 am ET. On Tuesday, the data from the American Petroleum Institute showed U.S. oil inventories to have risen by 7.6 million barrels last week.

Natural gas for May is down $0.009 or 0.19 percent at $4.559 per million btu.

Gold prices are up after Tuesday's sharp fall, although weak inflation data from the U.S. and a likely drop in demand from China due to an economic slowdown are capping gains.

Gold futures for June are up $0.20 or 0.02 percent at $1,300.50 an ounce

Silver for May delivery is up $0.109 or 0.56 percent at $19.598 an ounce, after rising to $19.805 an ounce earlier in the day.

Meanwhile, copper is up $0.050 or 1.67 percent at $3.037 per pound.

In the currency market, the Canadian loonie is trading at 1.1000 against the greenback, down 0.19 percent from previous close, giving back earlier gains after the Bank of Canada maintained interest rates at 1 percent. The bank noted that a lower exchange could provide more support to exports.

On the economic front, investors will be looking ahead to Bank of Canada's rate decision, due at 10:30 am ET. The bank is widely expected to hold rates at 1 percent.

In economic news from the U.S., housing starts rose at the fastest pace in three months, moving up 2.8 percent to a seasonally adjusted annual rate of 946,000, the Commerce Department reported. However, that was short of economists' expectations for a rise to 965,000 units.

Meanwhile, building permits declined 2.4% to 990,000 units, against expectations of 1.01 million units.

According to a report from the Federal Reserve, industrial production in the U.S. rose by more than expected 0.7 percent in March, after surging up by an upwardly revised 1.2 percent in February.

Economists had been expecting production to rise by about 0.5 percent compared to the 0.6 percent increase originally reported for the previous month.

Investors will now be looking forward to Federal Reserve Chair Janet Yellen's speech at the Economic Club of New York at 12:15 pm ET, and Dallas Federal Reserve Bank President Richard Fisher's speech on the U.S. and regional economic outlook in Austin, Texas at 1:25 pm ET.

The Federal Reserve is due to release its Beige Book report, a compilation of anecdotal evidence on economic conditions from each of the 12 Federal Reserve districts.

In Asia, China's gross domestic product expanded 7.4 percent on year in the first quarter of 2014, topping expectations for 7.3 percent growth following the 7.7 percent gain in the previous three months.

Asian markets mostly ended higher. Major European markets are also trading firm.