TSX Ends Higher Ahead Of Fed Outcome -- Canadian Commentary

(RTTNews) - Canadian stocks ended higher for a second straight session on Tuesday, even as investors await the outcome from the two-day policy meet of the U.S. Federal Reserve that began earlier today.

Markets in Europe have largely ended in the negative, due partly to some weak economic data with German investor sentiment coming in below expectations and eurozone employment growth slowed in the fourth quarter. The decline in U.S. housing starts also impacted European markets.

Although the Nasdaq settled higher, U.S. markets ended largely in negative territory, under pressure after housing starts for February fell well short of expectations. Investors were also cautious ahead of the 2-day Federal Reserve monetary policy meeting, with the Fed expected to provide cues as to the likely timing of its interest rate hikes. Many economists foresee no rate hike before September as there are still signs of weakness in the world's largest economy.

In some disappointing economic data, new residential construction in the U.S. showed a substantial decrease in February, with housing starts falling to their lowest level in over a year, a report from the Commerce Department showed on Tuesday.

The benchmark S&P/TSX Composite Index closed Monday at 14,898.53, up 35.77 points or 0.24 percent. The index scaled an intraday high of 14,922.09 and a low of 14,722.47.

On Monday, the index closed at 14,862.76, up 131.27 points or 0.89 percent. The index scaled an intraday high of 14,913.54 and a low of 14,719.27.

Gold futures ended lower ahead of the closely watched Federal Reserve meeting minutes, as the two-day meet began in Washington with the central bank likely to provide hints as to its interest rate hike schedule.

The Gold Index shed 1.34 percent, with gold for April delivery dropping $5.00 or 0.4 percent to settle at $1,148.20 an ounce on the New York Mercantile Exchange Tuesday.

Among gold stocks, Kinross Gold Corp (K.TO) fell 4.35 percent, Eldorado Gold Corp. (ELD.TO) lost 2.30 percent, Barrick Gold Corp. (ABX.TO) shed 2.23 percent, Yamana Gold Inc. (YRI.TO) plunged 6.67 percent, and IAMGOLD (IMG.TO) fell 3.66 percent.

Goldcorp (G.TO) dropped 2.77percent and B2Gold (BTO.TO) surrendered 2.11 percent.

The Capped Materials Index shed 0.78 percent, due mainly to declining gold stocks, with Potash Corp. of Saskatchewan Inc. (POT.TO) up 0.47 percent and Agrium Inc. (AGU.TO) down 0.31 percent.

Franco-Nevada (FNV.TO) gained 0.97 percent, while Agnico Eagle Mines (AEM.TO) fell 1.16 percent. Silver Wheaton (SLW.TO) dropped 5.93 percent.

Crude oil lower ahead of the weekly oil report, amid reports of progress in the talks between Iran and world powers over Tehran's nuclear program. A deal could see easing sanctions against Tehran, which could mean more oil in the already over-supplied market.

The Energy Index gained 0.91 percent, with U.S. crude oil futures for April delivery, shedding $0.42 or 1 percent to settle at $43.46 a barrel on the New York Mercantile Exchange Tuesday.

Among energy stocks, Canadian Oil Sands Limited (COS.TO) added 1.69 percent, Suncor Energy Inc. (SU.TO) dipped 0.31 percent, Canadian Natural Resources Limited (CNQ.TO) added 1.35 percent, and Encana Corp. (ECA.TO) surrendered 0.64 percent.

Crescent Point Energy Corp. (CPG.TO) gained 1.18 percent, while Cenovus Energy Inc. (CVE.TO) gathered 0.66 percent.

The heavyweight Financial Index dipped 0.09 percent, with Bank of Nova Scotia (BNS.TO) dropped 0.71 percent, and Bank of Montreal (BMO.TO) shed 0.74 percent.

National Bank of Canada (NA.TO) surrendered 0.11 percent, while Toronto-Dominion Bank (TD.TO) gained 0.32 percent. Canadian Imperial Bank of Commerce (CM.TO) fell 0.69 percent. Royal Bank of Canada (RY.TO) shed 0.91 percent.

The Diversified Metals & Mining Index added 0.44 percent, as First Quantum Minerals Ltd. (FM.TO) rose 0.65 percent, Lundin Mining Corp. (LUN.TO) moved up 2.00 percent, and Teck Resources Limited (TCK-B.TO) fell 0.29 percent.

The Health Care Index fell 0.55 percent, as Valeant Pharmaceuticals International, Inc. (VRX.TO) dropped 0.86 percent gained 3.25 percent, after pricing its previously announced registered offering of common shares. The company will issue 7,286,432 common shares at a price of $199.00 per share.

Among other health care stocks, Catamaran Corp. (CCT.TO) dropped 0.74 percent.

The Capped Industrials Index dipped 0.01 percent, with Bombardier Inc. (BBD.B.TO) down 0.40 percent after revealing a Letter of Intent with Fly Mojo Sdn Bhd for the sale and supply of 20 CS100 aircraft with options for an additional 20 CS100 aircraft.

Air Canada (AC.TO) down 1.45 percent.

Canadian National Railway (CNR.TO) is losing 0.72 percent. The company announced that members of the Unifor union have ratified the clerical/intermodal, Savage Alberta Railway, excavator-operator and CNTL owner-operator collective agreements.

The Information Technology Index surrendered 0.90 percent, with BlackBerry Limited (BB.TO) up 0.16 percent and Sierra Wireless, Inc. (SW.TO) added 3.84 percent and Descartes Systems Group Inc. (DSG.TO) up 0.26 percent.

The Capped Telecommunication Index inched up 0.04 percent, with Rogers Communications Inc. (RCI.B.TO) down 0.28 percent, BCE Inc. (BCE.TO) added 0.77 percent and TELUS Corp. (T.TO) gained 0.77 percent.

First National Financial (FN.TO) gained 0.98 percent, after detailing its monthly dividend payment of $0.125 per common share for March.

Alimentation Couche-Tard (ATD-A.TO) rose 2.45 percent, after reporting third quarter adjusted earnings of $0.51 per share. The Company's Board also declared a quarterly dividend in Canadian dollar cents of 4.5 per share for the third quarter

On the economic front, Canadian manufacturing sales dropped by 1.7 percent in January, according to a report from Statistics Canada Tuesday morning. Economists had expected a decrease of 1.2 percent. The December sales data was also revised down to an increase of 1.6 percent, from the 1.7 percent gain that was initially reported.

In other economic news, new residential construction in the U.S. showed a substantial decrease in February, a report from the Commerce Department on Tuesday. Housing starts plummeted by 17.0 percent to an annual rate of 897,000 in February from the revised January estimate of 1.081 million. Economists expected housing starts to dip to 1.048 million from the 1.065 million originally reported for the previous month.

Meanwhile, the Commerce Department said building permits climbed 3.0 percent to an annual rate of 1.092 million in February from the revised January rate of 1.060 million. Building permits, an indicator of future housing demand, had been expected to inch up to 1.058 million from the 1.053 million originally reported for January.

Eurozone employment grew at a slower pace at the end of 2014, data from Eurostat showed Tuesday. Employment rose 0.1 percent in the fourth quarter from a quarter ago, which was slower than the 0.2 percent rise in the third quarter and 0.3 percent in the second quarter.

Eurozone consumer prices remained negative for the third month in February as initially estimated, final report from Eurostat showed Tuesday. The harmonized index of consumer prices fell 0.3 percent in February from last year, slower than January's 0.6 percent decline. The annual decrease came in line with the flash estimate published on March 2.

German investor sentiment strengthened for the fifth consecutive month in March to its highest level in a year, a closely watched survey revealed Tuesday. Nonetheless, the improvement was weaker than expected, suggesting that concerns over the Greek crisis impacted optimism.

The economic sentiment indicator climbed to 54.8 from 53 in February, survey data from the Centre for European Economic Research, or ZEW, showed Tuesday. It was the highest value of the index since February 2014. Economists had expected a higher score of 59.4.

The leading economic index in the UK, which measures the future economic activity, increased at the start of the year, figures from the Conference Board showed Monday. The Conference Board leading economic index rose 0.2 percent in January, after staying flat in the previous month. In November, the index had dropped 0.4 percent.