NEW YORK (MarketWatch) -- Canada stocks traded higher Monday on the back of rising commodities, which were boosted by a positive May manufacturing report from China, and by a smaller-than-expected contraction in Canada's economy. The S&P/TSX Composite Index (CA:ISPTX 10,591, +220.57, +2.13%) increased 235 points, or 2.3%, to 10,606 points. The S&P/TSX Capped Energy Trust Index (CA:IRTEN 122.59, +3.95, +3.33%) climbed 3%. The S&P/TSX Capped Diversified Metals Index (CA:ITTMN 593.55, +31.29, +5.57%) jumped nearly 7%. A rally in metals and oil prices helped propel resource companies on the TSX. First Quantum Minerals Ltd. (CA:FM 51.00, +2.36, +4.85%) rose 4.8%. Petro-Canada (CA:PCA 49.42, +1.92, +4.04%) increased nearly 4%. Canadian Natural Resources Limited (CA:CNQ 68.15, +3.44, +5.32%) rose 5.8%. Copper futures rallied Monday in New York, climbing to their highest level in more than seven months. See Metals Stocks. Copper for July delivery rose 10 cents, or 4.4%, to $2.29 a pound on the Comex division of the New York Mercantile Exchange. Underpinning the day's gains in industrial metals and oil prices, China reported a third straight month of expansion in manufacturing. Crude for July delivery rose $1.64, or 2.5%, to $67.95 a barrel. It surged to $68.29 earlier, the highest level for a front-month contract since early November. See full story. Statistics Canada said Canada's real GDP contracted at an annualized rate of 5.4% in the first quarter, led by the manufacturing sector, which was dragged-down by a 26% decline in motor vehicle production, according to the agency's announcement. Analysts at BMO Capital Markets were expecting an annualized contraction of 6.7%, according to a client memo Monday. The quarterly decline of 1.4% was the largest three-month loss since 1991. Business investment fell at the fastest rate since 1982. In currency markets, the Canadian dollar edged up against the U.S. dollar. One loonie bought 92.12 cents, up almost a penny on the day.

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