Stocks in Toronto floundered a bit at the open Wednesday before making their way into positive country, amid rising oil prices, mixed earnings reports and major acquisition activity in the oil patch.
The S&P/TSX composite index was in the green 19.78 points to begin Wednesday at 12,427.48
The Canadian dollar regained 0.41 cents to 101.77 cents U.S.
Canadian affiliates of U.S. energy giant Exxon Mobil Corp. have agreed to buy Celtic Exploration Ltd. of Calgary in a transaction valued at $3.1 billion, including assumed debt and spending obligations.
Celtic’s shareholders are being offered $24.50 per share and a half-share of a new company, code-named Spinco, in return for each share. Celtic’s stock closed Tuesday at $18.12 on the Toronto Stock Exchange before the announcement. The news sent Celtic shares over the moon, gaining $8.23 in the first hour, or 45.4%, to $26.35.
Also in Canada's energy sector, Penn West Petroleum Ltd. has agreed in principle to sell $1.3 billion worth of its non-core properties, representing the equivalent of 12,000 barrels per day of production. Details weren't disclosed. Penn West shares started the session ahead 34 cents, or 2.5%, to $14.00.
In corporate earnings, PotashCorp says its profit this year will fall short of expectations following delays in reaching contracts with fertilizer buyers in China and India. It says that earnings for the full 2012 financial year will fall below even the lowest previous estimate of $2.80 to $3.20 per share. Potash shares slipped 15 cents to $40.95 early in Wednesday trading.
ON BAYSTREET
The TSX Venture Exchange gained 3.35 points to 1,303.13
The 14 Toronto subgroups were evenly split between winners and losers. Energy powered the former group, taking on 1.1%, while global base metals were 0.6% stronger, and utilities were 0.1% to the good.
The seven laggards were weighed by the metals and mining and information technology groups, sliding 0.6% each, while industrials sank 0.4%.
ON WALLSTREET
Equities south of the border opened lower Wednesday but quickly turned mixed, as investors took in new housing market data and another batch of corporate earnings.
The Dow Jones Industrial average dipped 3.90 points to 13,547.90
The S&P 500 gained 2.62 points to 1,457.54, while the tech-rich Nasdaq acquired 6.64 points to 3,107.82
Bank of America reported third-quarter earnings that topped expectations, citing improved lending and deposits. Shares of the bank rose slightly in early trading.
PepsiCo’s earnings that topped forecasts, but revenue slipped more than 5% from a year ago. Shares of the soft drink manufacturer edged up slightly. Earnings from Abbott Laboratories also beat expectations.
Results from American Express are due after the close.
After the markets closed Tuesday, chip maker Intel reported earnings that beat Wall Street's expectations, but fell from a year earlier. Investors were also turned off by the company outlook. Shares of the company were down 3% on the news.
IBM posted earnings that topped forecasts by a penny a share, but revenue fell short of expectations, weighing shares more than 4% lower.
Economically speaking, U.S. housing starts, which tally the number of new homes under construction, climbed 15% to an annual rate of 872,000 in September, according to the Census Bureau.
That’s a four-year high, surpassing what economists had expected. Building permits for future construction also rose to the highest level in more than four years.
The price of the benchmark 10-year U.S. Treasury plummeted, hiking the yield to 1.77% from Tuesday’s 1.72%. Treasury prices and yields move in opposite directions.
Oil prices acquired 28 cents to $92.37 U.S. a barrel.
Gold prices were off $1.30 to $1,745 U.S. an ounce.
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