TSX little changed following big gains; N.Y. weak amid housing data

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TORONTO - The Toronto stock market closed little changed Wednesday as hopes for improving economic conditions attracted buyers for industrial and base metal stocks and investors digested the big gain of the previous session.

The S&P/TSX composite index closed 13.51 points higher at 11,921.05, while the TSX Venture Exchange was ahead 0.35 of a point at 1,461.86.

The Canadian dollar was off 0.03 of a cent at 97.52 cents US.

The base metals sector was ahead 0.6 per cent even as the July copper contract on the Nymex shed a penny to US$2.99. But the dip followed six straight days of gains, helped along by data last week showing rising Chinese exports. HudBay Minerals (TSX:HBM) gained 34 cents to C$12.04.

A billion-dollar deal between a Chinese company and a Vancouver mining firm, announced in March, has come undone. Quadra FNX Mining Ltd. (TSX:QUX) said Wednesday it was unable to reach a definitive agreement with State Grid International Development Ltd., which was to invest $900 million in a joint venture to develop Quadra projects in Chile. Quadra FNX shares fell 10 cents to $12.48.

Transportation stocks rose alongside the mining sector with Canadian Pacific Railway (TSX:CP) ahead 65 cents to $61.35.

Bombardier Transportation (TSX:BBD.B) shares were 11 cents higher at $4.94 after the company won a contract with Swiss Railways to supply new double-deck trains for inter-city travel. The contract for 59 Bombardier Twindexx trains, with options for 100 more, has a total value of around US$1.6 billion.

Gold stocks advanced even as the August gold contract in New York declined $3.90 to US$1,230.50 an ounce. Goldcorp Inc. (TSX:G) edged up 74 cents to C$45.14.

The TSX energy sector was slightly higher while the July crude contract on the New York Mercantile Exchange shook off early losses to move up 73 cents to US$77.67 barrel. Suncor Energy (TSX:SU) climbed 39 cents to C$34.87.

Crude prices had earlier been negative after the U.S. Energy Information Administration reported an increase of 1.7 million barrels from the week ended June 11. Analysts surveyed by Platts expected a decrease of around 1.75 million barrels.

Prices ran ahead more than US$3 over the past two sessions on expectations the data would show supplies falling, indicating that demand was improving along with the economic recovery.

BP shares rose 45 cents to US$31.85 in New York as the company's agreement to put US$20 billion into a fund for victims of the Gulf of Mexico oil spill eased some of the uncertainty about the company's stability. BP also decided it would suspend dividend payments in the second and third quarters, and cancel the first-quarter payment that was due on June 21.

The tech and consumer discretionary segments led decliners with Research In Motion Ltd. (TSX:RIM) down $1.30 to $63.19. The stock had surged about five per cent Tuesday following a report that the BlackBerry maker is working on a media tablet to compete with Apple's iPad.

Shares in auto parts company Magna International (TSX:MG.A) fell $4.06 to $69.30 after the Ontario Securities Commission said Tuesday that it wants to block a plan to eliminate a dual-class share structure at the firm that will see founder and chairman Frank Stronach receive an 1,800 per cent premium for his multiple voting shares.

The provincial regulator said shareholders are being asked to approve the plan without sufficient information to form a reasoned judgment - a position that Magna disputes.

Stock markets had closed sharply higher on Tuesday as hopes for higher demand boosted oil and copper prices while investors also took in data showing improving manufacturing activity in the New York area. The TSX ran up 240 points while the Dow industrials gained 214 points.

And analysts suggest that advance, plus a gain of about one per cent last week, may herald a brief rally on markets.

"I think what we are seeing is a bit of a relief rally in that the realization that the problems in Europe might not have as real an impact to the recovery in North America as may have been priced into the markets in May," said Phillip Petursson, director of institutional equities at MFC Global Investment Management.

"That's the realization. We've seen a good selloff in the markets. Valuation is pretty attractive much across the board. From here, it's where do we want to be?"

New York markets were mixed amid weak housing and corporate data.

The Dow Jones industrial average was ahead 4.69 points to 10,409.46.

The Nasdaq composite index added 0.05 of a point to 2,305.93 while the S&P 500 index fell 0.62 of a point to 1,114.61 as U.S. home construction plunged last month to the lowest level since December as builders scaled back without a tax credit from the U.S. government to lure buyers. Building permits also fell, a sign the construction industry won't fuel the economic recovery.

Other data showed that industrial production in the U.S. rose 1.2 per cent in May, much better than the 0.8 per cent gain that analysts had expected.

In other corporate news, Nokia Corp., the world's largest mobile phone maker, says its performance this year will be worse than earlier expected because of tough competition, especially in the smartphone market. Nokia shares fell $1.05 to US$8.77 as it said its second-quarter net sales will be "at the lower end of, or slightly below, its previously expected range of euro6.7 billion to euro7.2 billion (US$8.2 billion to US$8.8 billion).

Sceptre Investment Counsel Limited (TSX:SZ) and Fiera Capital Inc. say they have signed a definitive agreement to merge the two companies into a bigger money manager with $30 billion in assets. Sceptre shares ran ahead $1.50 or 28.85 per cent to $6.70.

TD Bank (TSX:TD) shares were 27 cents lower at $73.21 after the bank set the earnings growth target for its U.S. personal and commercial banking operations at US$1.6 billion over next three years, but the head of the division said profits could race even higher. TD has been bulking up its U.S. presence in recent months, picking up a number of banks in the southeast.

Organizations: TSX, S&P, Nymex HudBay Minerals FNX Mining State Grid International Development BP Canadian Pacific Railway Bombardier Transportation Swiss Railways Research In Motion Ltd. Goldcorp Inc. New York Mercantile Exchange Suncor Energy U.S. Energy Information Administration Dow Jones industrial average Apple Magna International Ontario Securities Commission MFC Global Investment Management Nokia Sceptre Investment Counsel Limited Fiera Capital TD Bank

Geographic location: New York, U.S., TORONTO Vancouver Chile Gulf of Mexico Europe North America

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