The Toronto stock market was higher Tuesday as traders hoped for a quick end to the U.S. government's partial shutdown, which began at midnight due to a political impasse rooted in a long-running dispute over President Barack Obama's health-care law.
The S&P/TSX composite index gained 60.25 points to end the day at 12,847.44
Falling commodity prices and a weaker economic outlook from the Bank of Canada helped push the Canadian dollar down 0.20 cents to 96.83 cents U.S., even as the American dollar weakened against other currencies.
The bank's senior deputy governor, Tiff Macklem, said the central bank expects third- and fourth-quarter growth to come in at two to 2.5%. It had previously forecast growth in the July-September period of 3.8% and 2.5% in the final quarter.
The TSX industrial sector gained ground with Canadian National Railway ahead $1.60 to $105.97.
The energy sector rose while oil prices were lower for a third day amid worries about the effect of the shutdown on the U.S. economy and weak Chinese manufacturing data.
Among energy plays, Canadian Natural Resources improved by 48 cents to $32.85.
Utilities also lent support with Atlantic Power ahead 34 cents, or 7.7%, to $4.76.
Miners were the biggest TSX weight with the gold sector down as prices for the traditional safe haven retreated.
Barrick Gold Corp. dropped 57 cents, or 3%, to $18.61.
The base metals sector was down while metal prices were also lower with December copper down five cents at $3.27 U.S. a pound. First Quantum Minerals shed 55 cents, or 2.9%, to $18.63.
On the economic calendar, the September RBC Canadian Manufacturing Purchasing Managers' Index indicated a sharp jump in business conditions to 54.2 from 52.1 in August, the highest level of confidence over the past 15 months.
ON BAYSTREET
The TSX Venture Exchange eked up 0.76 points to 941.91
All but four of the 14 Toronto subgroups were higher by the end of the day, the biggest gains being shown by health-care, 1.9% stronger, while industrials powered 1.5% higher, and utilities were 1.2% to the good.
Gold’s 2.5% tumble proved the biggest of the four laggards, while metals and mining dipped 1.5% and materials slipped 1.4%.
ON WALLSTREET
Congress failed to pass a budget and triggered a government shutdown for the first time in nearly two decades Tuesday. But Wall Street took Washington's latest breakdown in stride.
The Dow Jones Industrials moved up 62.03 points to close Tuesday at 15,191.70
The S&P 500 index gained 10.79 points to 1,692.34. The NASDAQ spiked 46.50 points, or 1.2%, to 3,817.50, to close above 3,800 for the first time since September 2000
Shares of Apple rallied after Carl Icahn tweeted that he met with Apple CEO Tim Cook Monday and "pushed hard" for a $150-billion U.S. stock buyback. Icahn added that the two plan to continue the conversation in three weeks, which will be around the time Apple releases its fiscal fourth-quarter earnings. The activist investor also revealed that he now owns a nearly $2-billion U.S. stake in Apple.
Icahn first revealed that he has a large stake in Apple in August, and has been discussing his desire for a larger share repurchase program ever since. Apple currently has a plan to return $100 billion U.S. to shareholders over the next three years, mainly by buying back its own stock. Apple also pays a dividend.
Major automakers were also issuing their monthly sales reports throughout the day. Ford shares rose nearly 2% after reporting a 6% jump in sales for September. General Motors shares slipped after the company said sales dropped 11%, compared with a year earlier. Toyota Motor also reported a decline in sales.
Drugstore operator Walgreen beat earnings forecasts, sending shares higher. Rivals CVS Caremark and Rite Aid were also on the rise.
Netflix shares climbed 5% after MKM Partners raised its price target on the stock to $370 U.S. Shares hit an all-time high of $324.70 U.S. Tuesday.
During an interview on CNBC, Icahn reiterated that he hasn't sold a single share of Netflix but also noted that given the recent runup, he "won't say it's a no-brainer" to buy.
Shares of Merck also advanced after the drug maker announced that it plans to cut 8,500 more jobs worldwide.
Investors were also keeping a close eye on the state of the manufacturing sector Tuesday. The Institute for Supply Management's monthly report showed that manufacturing expanded more than expected in September, with the index rising to its highest level since April 2011.
Prices for the 10-year U.S. Treasury lost ground, raising yields to 2.65% from Monday’s 2.61%. Treasury prices and yields move in opposite directions.
Oil prices fell 48 cents to $101.85 U.S. a barrel.
Gold prices slid $36.30 at $1,290.70 U.S. an ounce.
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