Toronto stocks closed considerably higher in Wednesday trading, following the lead of U.S. and European markets. Strength in the resource sectors continued to lead the way.
The S&P TSX Composite Index closed Wednesday ahead 2.2%, or 219.63 points to 10,205.78, its best close since July 3
Mining stocks surged as copper enjoyed a strong day on the Comex. First Quantum added 5.8% at $57.65, Teck Resources grew 6.1% to $20.64 and Inmet was up 4.9% to $41.
Materials and gold stocks were up substantially on the day. Among the big names, Goldcorp gained 3.8% to $40.19, Agnico-Eagle Mines picked up 3.5 to $60.62% and Eldorado climbed 1.7% to reach $10.11.
NovaGold Resources slid 0.8% to $4.72 after the company announced its second-quarter loss narrowed to $4.8 million or $0.03 per share compared with $23.2 million or $0.22 per share in the prior year period, reflecting reduced exploration expense, foreign exchange gain.
Energy stocks gained as Canadian Oil Sands was up 5.7% to $26.70, Suncor added 3.5% to $32.56 and Canadian Natural Resources increased 3.6% to $60.10.
Financials were ahead, as CIBC climbed 3.6% to $62.17 to lead the way.
On the corporate front, Air Canada surged 9.9% to $1.45 after the International Association of Machinists and Aerospace Workers reportedly voted to accept a new 21-month contract.
Corus Entertainment fell 2.9% to $13.35 after the company reported that its third-quarter net loss was $145.0 million or $1.81 per share, compared to net income of $37.7 million or $0.45 per share in the year ago quarter.
CVTech Group added 6.9% to $1.55 after it said it has signed a share purchase agreement for the acquisition of Riggs Distler & Company, effective retroactively to July 1. The deal is worth approximately $43.0 million.
DragonWave soared 15.7% to $5.83 after the company reported a net loss for the first quarter of $2.88 million or $0.10 per share, compared to a net loss of $1.94 million or $0.07 per share in the year-ago quarter.
In economic news, Canadian manufacturing sales fell 6.0% to $38.4 billion in May, the lowest level since November 1998, according to data released Wednesday morning by Statistics Canada. Economists forecast a drop of 0.8%.
The Canadian dollar rocketed up 1.7 cents to 89.71 cents U.S.
ON BAYSTREET
All but one of the 14 TSX subgroups were in the black. Metals and mining climbed 5.1%, global base metals moved ahead 3.7%, materials improving 3.1%. Health-care, the one laggard, trailed yesterday’s close by 0.2%.
The TSX Venture Exchange moved higher 27.16 points, to 1,082.55, while the Nasdaq Canada Index leaped 34,67 points to 687.66
ON WALLSTREET
In New York, stocks surged Wednesday, with all three major gauges jumping at least 3% after Intel's forecast for a second-half pickup and the Federal Reserve's improved outlook reassured wary investors.
The Dow Jones Industrials average sprinted ahead 256.72 points, or 3.1%, to 8,616.21. The S&P 500 index picked up 26.84 points to 932.68. The Nasdaq composite index shot skyward 63.17 points, its best one-day rise in four months, to finish at 1,862.90.
The rally intensified after the Federal Reserve said Wednesday afternoon that the end of the recession might be on the horizon.
Intel reported profit and revenue late Tuesday that dipped from a year ago, but surpassed forecasts. Also, the chipmaker predicted better revenue growth in the third and fourth quarters thanks to improved demand for personal computers.
With corporate demand still tepid, Intel's outlook will depend on consumers continuing to buy despite rising oil and gas prices and the ongoing recession. However, even with that caveat, investors embraced the forecast.
S&P 500 profits are expected to have fallen around 36% in the second quarter versus a year ago, according to the latest Thomson Reuters forecast.
Worries about the corporate earnings outlook and the health of the economy have dragged on stocks over the last month -- following a three-month rally that lifted the S&P 500 by 40%.
In the afternoon, the Fed released the minutes from the last policy meeting and the forecast through 2010.
Information reviewed at the meeting showed the economy remained weak, although the pace of the decline seemed to be lessening.
In its forecast, the Fed said that the unemployment rate could top 10% this year, but it also said that the recession could soon end.
Intel shares jumped 7% in afternoon trading and boosted other big tech stocks.
Dow tech components Microsoft, IBM and Hewlett-Packard all gained. Big Nasdaq tech stocks gained too, including Cisco Systems, Oracle and Applied Materials
On Tuesday, Goldman Sachs reported a bigger-than-expected quarterly profit due to strength in its fixed income and trading businesses.
Citigroup, Bank of America and JPMorgan Chase report results either Thursday or Friday.
Goldman and the other three bank stocks rallied, along with other big financial firms American Express, Morgan Stanley and Wells Fargo.
Economically speaking, the CPI rose 0.7% in June, the government said, slightly higher than the 0.6% gain expected by a consensus of economists surveyed by Briefing.com.
This is compared to May, when the CPI edged up 0.1%.
Excluding food and energy prices, the so-called core CPI rose 0.2%, compared to the 0.1% expected by Briefing.com consensus. This is compared to May, when the core CPI edged up 0.1%.
Industrial production fell 0.4%, according to another government report, versus forecasts for a drop of 0.6%. Industrial production fell 1.2% in May. Capacity utilization dipped to 68% from 68.2% in the previous month. Economists thought it would dip to 67.9%
Treasury prices lost still more ground, raising the yield on the benchmark 10-year note to 3.62%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil gained $2.02 to $61.80 U.S.
Gold prices shot up $17 an ounce to $940 U.S.
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