Markets in Toronto rebounded strongly on Tuesday, after recording its biggest drop in eight weeks the previous session, as gains in financial and resource shares offset concerns about the fate of the U.S. Federal Reserve's stimulus program.
The S&P/TSX composite index hiked 97.14 points to greet noon at 12,685.16
The Canadian dollar dipped 0.31 cents to 96.36 cents U.S.
Financials, the index's most heavily weighted sector, climbed as Royal Bank of Canada, the country's biggest lender, added 1% to $64.66 and had the biggest positive influence on the index. Toronto-Dominion Bank rose 0.9% to $87.68.
The materials sector, which includes mining stocks, advanced, aided by the gains in gold producers. Goldcorp Inc rose 2.8% to $32.86, and Barrick Gold Corp. was up 2% and $20.32.
Despite lower oil prices, shares of energy companies also gained strength. In the group, Canadian Natural Resources Ltd. was up 1.2%, at $31.03.
In other news, shares of Nordion Inc jumped 7.8% to $8.30 after the medical isotope provider said it settled a lawsuit with its main supplier, Atomic Energy of Canada Ltd, and would receive a settlement.
In the economic docket this morning, Statistics Canada reported that its wholesale trade index plummeted 2.8% in June, with declines pretty much across the board. The loss offset what had been gained in the two months before.
ON BAYSTREET
The TSX Venture Exchange dropped 2.38 points to 931.27.
All but two of the 14 Toronto subgroups were higher by midday, led by gold, ahead 3.4%, materials, strengthening 2.1%, and utilities, recovering 1.2%.
The two laggards were consumer staples, down 0.3%, while telecoms faded 0.2%.
ON WALLSTREET
U.S. stocks edged higher Tuesday and were on track to climb out of a four-day slump, as investors focused on earnings reports from several prominent retailers.
The Dow Jones Industrials improved 55.95 points by lunch time to 15,066.70
The S&P 500 index gained 11.40 points to 1,657.46. The NASDAQ added 33.45 points to 3,622.53
J.C. Penney posted a big loss that was even worse than the forecasts. Despite that, the struggling retailer noted that its same store sales, a key measure for retailers, were slightly better than they were during the first quarter of 2013.
Shares surged in early morning trading on the news, but then struggled to hold on to those gains.
Best Buy has also struggled recently, but appears to be a step ahead of J.C. Penney in the turnaround process. The electronics retailer reported a surge in profit, which CEO Hubert Joly attributed to aggressive cost-cutting. The stock was up about 10% Tuesday and has now gained 185% so far this year.
Retailers Urban Outfitters and TJX were also top performers in the S&P 500 after releasing solid earnings reports.
Home Depot announced a gain in quarterly net profit and raised its guidance for 2013. Its rival Lowe's will report results tomorrow.
But not all the reports from retailers were good. Bookseller Barnes & Noble recorded a loss and said revenue from its Nook tablet business was down 20% from the same quarter last year. The stock plunged.
The release Wednesday of minutes from the Federal Reserve's last monetary policy meeting will be closely watched for clues as to when the central bank will begin tapering its $85-billion-U.S.-a-month bond purchases.
More signals could come from the Kansas City Fed's annual conference in Jackson Hole, Wyoming, later this week.
Prices for the 10-year U.S. Treasury hiked, lowering yields to 2.83% from Monday’s 2.88%. Treasury price and yields move in opposite directions.
Oil prices dipped 35 cents to $106.75 U.S. a barrel.
Gold prices picked up $6.10 to $1,371.80 U.S. an ounce.
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