TSX Ends At Record High On ECB Stand, Tim Hortons -- Canadian Commentary

By RTT News, 
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(RTTNews.com) - Canadian stocks snapped a two-day loss to end at a record high Monday, tracking rising global equity markets as market sentiments improved on expectations that major central banks would maintain continued low interest rates. The main index was also pepped up after Tim Hortons registered significant gains amid news of its imminent acquisition by Burger King Worldwide Inc.

Although, Federal Reserve Chair Janet Yellen's address at the Jackson Hole Symposium did not provide much clarity to the Fed 's interest rate outlook, markets were propped up after European Central Bank Chief Mario Draghi said the bank may come out with more stimulus in the event of a further drop in inflation.

Gains in European markets amid expectations of fresh stimulus from the European Central Bank and positive mood on Wall Street where the S&P 500 index crossed the 2,000 mark lifted sentiments.

Nonetheless, gold and energy stocks continued to trend lower amid sluggish commodity prices.

The benchmark S&P/TSX Composite Index is up 56.07 points or 0.36 percent at 15,591.62, a new all-time intraday high.

The S&P/TSX Composite Index closed Monday at 15,598.74, up 63.19 points or 0.41 percent, to end at an all-time high closing. The index scaled a intraday high of 15,623.99 and a low of 15,535.94.

On Friday, the index ended lower at 15,535.55, but for the week, the index gained about 1.5 percent.

The Consumer Discretionary Index jumped 2.04 percent, driven by Tim Hortons Inc. (THI.TO) shares that surged 19.26 percent.

Tim Hortons Inc. and Burger King Worldwide Inc. ( BKW ) have confirmed they are in discussions to create a global leader in the quick service restaurant business. The new publicly-listed company would be headquartered in Canada.

Crude oil ended lower on demand growth concerns despite persistent geopolitical tensions in the Middle East and Ukraine.

The Energy Index added 0.59 percent, with U.S. crude oil futures for September dropping $0.30 or 0.3 percent to close at $93.35 a barrel Monday on the Nymex.

Among energy stocks, Cenovus Energy Inc. (CVE.TO) gained 0.98 percent, Enbridge Inc. (ENB.TO) added 0.53 percent, Suncor Energy Inc. (SU.TO) gathered 0.77 percent, Encana Corp. (ECA.TO) moved up 1.62 percent, and Canadian Natural Resources Limited (CNQ.TO) gained 0.71 percent.

The Financial Index gained 0.28 percent, with Royal Bank of Canada (RY.TO) up 0.22 percent, Toronto-Dominion Bank up 0.26 percent, and Bank of Nova Scotia (BNS.TO) up 0.94 percent.

Gold futures ended lower on Monday tracking rising global equity markets and uncertainty over rate hikes after Fed Chair Janet Yellen provided little clarity to the issue at the Jackson Hole Symposium.

Global Gold Index dropped 1.26 percent, with gold for December delivery slipping $1.30 or 0.1 percent to close at $1,278.90 an ounce on the New York Mercantile Exchange Monday.

Among gold stocks, B2Gold Corp. (BTO.TO) dropped 3.66 percent, Yamana Gold Inc. (YRI.TO) lost 2.07 percent, Eldorado Gold Corp. (ELD.TO) shed 1.83 percent, and Barrick Gold Corp. (ABX.TO) declined 1.10 percent.

The Capped Materials Index slipped 0.46 percent as gold stocks stumbled, with Potash Corp. of Saskatchewan Inc. (POT.TO) adding 0.47 percent.

The Diversified Metals & Mining Index added 0.74 percent, with First Quantum Minerals Ltd. (FM.TO) up 2.24 percent, Lundin Mining Corp. (LUN.TO) up 1.00 percent, and Teck Resources Limited (TCK.B.TO) added 0.16 percent.

The Capped Industrials Index gained 0.49 percent, with Bombardier Inc. (BBD.B.TO) ending flat at $3.81 a share and Air Canada (AC.B.TO) edging up 0.22 percent.

The Capped Telecommunications Index moved up 0.34 percent, with Rogers Communications Inc. (RCI.B.TO) adding 0.64 percent.

The Information Technology Index added 0.56 percent, with BlackBerry Limited (BB.TO) gaining 1.25 percent.

The Healthcare Index moved up 0.34 percent, with Valeant Pharmaceuticals International Inc. (VRX.TO) shedding 1.22 percent.

On Friday, Pershing Square Capital LP indicated submitting written requests from 31 percent of Allergan Inc ( AGN ) stockholders, demanding the Botox maker call a special meeting to discuss a rejig of the board as well as the unsolicited acquisition offer from Valeant.

Meanwhile, Extendicare Inc. (EXE.TO) gained 1.52 percent and Catamaran Corp. (CCT.TO) gathered 0.45 percent.

In economic news from the U.S., sales of new single-family homes in July dropped 2.4 percent from June to a seasonally adjusted annual rate of 412,000, the Commerce Department said Monday.

It was the slowest pace of new home sales in four months, as demand was relatively weaker in all regions except the South. Economists expected a reading of 432,000. July sales were down 4.3 percent from a year earlier.

From Europe, German business sentiment weakened for the fourth consecutive month in August to its lowest level in a year, as the escalating crisis in Ukraine and the resultant sanctions against Russia pose downside risks to the economic activity.

The Ifo business climate index dropped to 106.3 in August, the lowest since July 2013, from 108 a month ago, a monthly survey conducted by the Ifo institute among 7,000 firms showed Monday. The indicator was forecast to drop to 107 in August.

Speaking at the Jackson Hole Symposium last Friday, European Central Bank President Mario Draghi said the ECB is willing to inject considerably more cash into the system if needed to keep low rates of inflation from taking hold. Meanwhile, the U.S. Federal Reserve Chair Janet Yellen gave little hint about monetary policy outlook.

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This article appears in: News Headlines

Referenced Stocks: ABX , AGN , BKW , BNS , CNQ

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