The Toronto stock market was higher Tuesday as prices for oil and metals advanced and Scotiabank delivered quarterly earnings that beat expectations.
The S&P/TSX Composite Index picked up 37.30 points to head into noon hour Tuesday at 11,603.45.
Scotiabank’s second-quarter profit was $1.46 billion or $1.15 per diluted share. That’s down from a year ago, when Scotiabank’s bottom line was helped by special items but slightly ahead of analyst estimates.
Adjusted earnings were $1.18 per share, three cents higher than the consensus estimate of analysts compiled by Thomson Reuters and its shares gained 98 cents to $51.77.
China’s huge appetite for oil and metals has been a primary driver for higher commodity prices and resource stocks on the TSX. However, prices for items such as crude and copper and resource stocks have taken a beating over the last couple of months on worries the global economic recovery is losing momentum.
For example, the TSX materials and energy indexes have plunged about 10% this year and oil and copper prices have sunk to multi-month lows.
The July copper contract added four cents to $3.49 U.S. a pound, taking the base metals sector up. Teck Resources rose 81 cents to $32.14.
The TSX energy sector rose as Suncor Energy gained 33 cents to $29.23.
The gold sector edged up as Goldcorp Inc. improved by 43 cents to $38.76.
Shares in Kinross Gold Corp. ran up 17 cents to $8.59 after the miner said it is selling its 50% interest in Crixas gold mine in Brazil to AngloGold Ashanti of South Africa for $220 million U.S.
Scotiabank’s performance helped push the financial sector up with Bank of Montreal 34 cents higher to $54.91.
ON BAYSTREET
The TSX Venture Exchange faded 5.68 points to 1,319.33. The Nasdaq Canada index tacked on 1.36 points to 366.85.
In all, 10 of the 14 Toronto subgroups were up by noon. Global base metals were boosted 2.2%, while their cousins in the metals and mining sector strengthened 1.4%, and industrials were 1% better.
The four laggards were weighed mostly by gold, off 1.9%, while materials sagged 0.8%, and telecoms slid 0.4%.
ON WALLSTREET
U.S. stocks rallied Tuesday as investors welcomed a lack of negative headlines out of Europe and hopes China will move to support its economy.
The gains came despite a weaker-than-expected report on U.S. consumer confidence and continued declines in home prices.
The Dow Jones Industrials approached noon up 72.69 points, off its highs of the day, to 12,527.50
The S&P 500 recovered 9.27 points to 1,327.09. The tech-rich Nasdaq Composite Index perked 10.75 points to 2,848.28
A weaker dollar helped support shares of multinationals and commodities companies. Heavy equipment maker Caterpillar and aluminum producer Alcoa led gainers on the Dow.
Shares of companies in the energy business rose as oil prices rebounded. Chevron, ConocoPhillips and Hess Corp. all gained more than 2%.
Shares of Facebook fell another 5.3% to $30.21 U.S., hitting a new low since the social network debuted as a public company earlier this month.
Investors were encouraged by signs over the weekend that pro-bailout parties in Greece were gaining in the polls. In addition, four major Greek banks received recapitalization funds under the nation's bailout program.
The extra capital helped ease concerns that a so-called bank jog in Greece could develop into a full-blown bank run.
Spain is also prominent in investors' minds amid fresh worries about the health of its banking system, after the Spanish government agreed last week to inject €19 billion into one of the nation's largest lenders.
The yield on 10-year Spanish government bonds eased slightly Tuesday, one day after the spread between Spanish and German debt reached the highest level since the creation of the euro.
Investors have also been fearful that the slowing of China's economy could cause a so-called "hard landing" for the world's number-two economy. But there is speculation Beijing will announce more stimulus spending in China, including a program to spur auto purchases.
The focus could shift back to the U.S. economy from overseas worries, given the importance of upcoming reports.
Due later this week is the May jobs report, as well as key readings on manufacturing and auto sales. Economists forecast that employers added 150,000 jobs in May, and that unemployment remained at 8.1%.
U.S. stocks fell Friday, but ended higher for the week, as concerns about the debt crisis in Europe continued to weigh on the market. U.S. markets were closed Monday for Memorial Day.
Worries over Greece's future and the broader region's debt problems have already triggered deep losses in U.S. stocks and international markets this month. The S&P 500 and Dow are down almost 6% in May, and headed for their worst monthly losses since November 2011.
Economically speaking, the Case-Shiller 20-city Index, which tracks home prices, fell 2.6% in March, after falling 3.5% in the prior month. Economists had expected the index to have slipped 2.8%.
The Conference Board's Consumer Confidence Index for May fell to 64.9, after falling to 68.7 last month. Economists had expected the index to ease to 69.4 in May, according to a consensus forecast from Briefing.com.
The price on the benchmark 10-year U.S. Treasury rose, pushing the yield down to 1.71% from 1.74% late Friday. Treasury prices and yields move in opposite directions.
The price of a barrel of oil was ahead 23 cents to $91.09 U.S.
Gold futures for June delivery added $10 to $1,580 U.S. an ounce.
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