The Toronto stock market surged Monday afternoon, led by a strong runup in energy stocks on hopes that oil prices may have found a bottom.
The S&P/TSX composite index gained 226.99 points, or 1.6%, to close Monday at 14,900.47
The Canadian dollar gained 0.74 cents to 79.36 cents U.S.
The energy sector rallied as momentum built on prices. Energy prices had jumped almost $4 on Friday amid news of a big drop in U.S. drilling rig counts as producers respond to oversupply.
This was good news for investors who have seen oil prices collapse on world markets due to a glut in global supply. Prices have plunged more than 50% since the highs of last summer.
Investors also digested earnings reports from energy sector heavyweight Imperial Oil, which posted fourth-quarter earnings of $671 million or 79 cents a share, seven cents ahead of estimates.
Earnings were down 36% from a year ago while production averaged 315,000 gross oil-equivalent barrels per day, down from 329,000 barrels a year ago. Its shares were ahead $2.11, or 4.5%, to $49.35.
Canadian Oilsands was a major gainer, up $1.60, or 20.4%, to $9.45, after TD Securities raised the target price of the stock to $8.50 from $8.
Financials also lent support, as Toronto Dominion hiked 73 cents, or 1.4%, to $51.33.
Metal prices were mixed with March copper unchanged at $2.49 U.S. a pound and the base metals component gained ground. Sherritt International added six cents, or 2.8%, to $2.20, while Teck Resources charged ahead 65 cents, or 4%, to $17.10.
The gold sector was flat as Barrick Gold docked four cents to $16.21, and Goldcorp gained four cents to $30.73.
ON BAYSTREET
The TSX Venture Exchange jumped 8.48 points to 685.29
All but two of the 14 Toronto subgroups were higher, as energy marched ahead 4.5%, while metals and mining took on 4.1%, and industrial stocks took on 2%.
Only information technology – down 0.5% -- and real-estate issues – off 0.02% -- missed the party.
ON WALLSTREET
U.S. stocks closed sharply higher on encouraging news from the euro-zone and stronger oil prices.
The Dow Jones Industrials spiked 196.09 points, or 1.1%, to 17,361.04,
The S&P 500 regrouped 25.86 points to 2,020.85. The telecommunication sector led gains on the S&P 500, but analysts did not see a direct cause for the 1.5% rise.
The NASDAQ index gained 41.45 points to 4,676.69.
Exxon Mobil reported earnings that beat expectations but were lower than the year-ago quarter.
Late last week, the Federal Communications Commission auctioned part of the wireless spectrum to major telecom companies led by AT&T for a total of $41 billion U.S. On Monday, the Wall Street Journal also reported that the FCC will likely announce this week that it will allow more cities to build broadband networks for high-speed Internet access.
In all, 85 S&P 500-listed companies are posting quarterly results this week, along with three Dow components.
The ISM manufacturing index hit 53.5 in January, below expectations of 54.5.
U.S. consumer spending recorded its biggest decline since late 2009 in December, with households appearing to save the extra cash from cheaper gasoline, which could support future consumption.
Moreover, in a budget plan to be unveiled on Monday, U.S. President Barack Obama will call for a one-time, 14% tax on profits piled up abroad by multi-nationals, such as General Electric and Pfizer. He will also seek to impose a 19% tax on U.S. companies' future foreign earnings.
Greece's new left-wing government began what one analyst called a "charm offensive" on Sunday, in an effort to persuade its euro-zone partners to soften the terms of its international bailout. The government has already started to reverse austerity measures unpopular in Greece that were a condition of its current bailout agreement.
Prices for 10-year U.S. Treasuries soared, lowering yields to 1.67% from Friday’s 1.75%. Treasury prices and yields move in opposite directions.
Oil prices moved up $1.67 per barrel to $49.91 U.S.
Gold prices fell $3.10 an ounce to $1,276.10 U.S.
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