Toronto stocks remained notably higher in Friday afternoon trading, erasing some of yesterday's 2.3% drop. Strength in the telecom and industrial sectors paced the gains.
The S&P/TSX Composite Index finished ahead on the day 75.73 points, to end a short week at 10,869.10
Industrials gained to lead the way. Canadian National Railway leaped 3.7% to $54.75 and Canadian Pacific added 2.1% to $50.78.
SNC-Lavalin picked up 3.5% to $47.52 after the company reported a rise in second-quarter net income to $80.03 million or $0.53 per share from $75.41 million or $0.49 per share in the prior-year quarter.
Telecom stocks were up as Telus Corp. surged 7.3% to $32.99. The company reported second-quarter net income of $244 million or $0.77 per share, compared to $268 million or $0.83 per basic share in the same quarter of last year.
In other corporate news, Nuvo Research dropped 3.5% to 28 cents after the company reported a net loss for the second quarter of $1.66 million or $0.01 per share, compared to a loss of $2.86 million or $0.01 per share in the year-ago quarter.
Manitoba Telecom Services was down 1.9% to $33.86 after the company reported net income for the second quarter declined to $30.1 million or $0.47 per share from $38.0 million or $0.58 per share in the previous year.
Thomson Reuters was downgraded to Underperform from Hold at Jefferies & Co. Shares were up 1.6% to $37.33
Manulife Financial was down 1.5% to $22.03 after the stock was downgraded to Underperform from Neutral at Credit Suisse.
Sun Life recovered some of yesterday's sharp losses and was up 1.4% to $33.47, despite being downgraded to Underperform to Neutral at Credit Suisse.
Canadian employment declined by 45,000 in July, with losses in both full- and part-time work, according to data released Friday by Stats Canada. Economists were expecting employment to decline by only 15,000 jobs.
The Canadian dollar was down 0.51 cents to 92.35 cents U.S.
ON BAYSTREET
Of the 14 TSX subgroups, 10 were higher, led by industrials, which advanced 2.9%, telecoms, which surged 2.8% and real-estate stocks, up 2.3%.
Of the four losing groups, gold was weighing things down the most at 1.6%, materials were off 0.8%, utilities were off 0.3%.
The TSX Venture Exchange advanced 4.46 points, to 1,192.58, while the Nasdaq Canada Index eased back 2.01 points to 762.58.
ON WALLSTREET
In New York, stocks jumped after the unemployment rate decreased for the first time since April 2008, bolstering speculation that a recovering economy justifies the steepest rally in equities in seven decades. The dollar advanced and Treasuries capped their biggest weekly drop in six years.
The Dow Jones Industrials charged ahead 113.81 points, or 1.2%, to end the week at 9,370.07. The S&P 500 index picked up 13.39 points to 1,010.47. The tech-rich Nasdaq composite improved 27.09 points to close at 2,000.25.
The S&P 500 has rallied 49% from a 12-year low on March 9, the steepest surge since the Great Depression. The market’s advance restored almost $4 trillion U.S. in value to U.S. equities, according to data compiled by Bloomberg, after 2008 marked the worst year for stocks since the 1930s.
Reports this month showed better-than-estimated sales of cars and existing homes and a contraction in service industries that was smaller than economists forecast.
The S&P 500 and the Dow have gained 12% and 6.8%, respectively, in 2009 as better-than-expected earnings and improving economic data suggest the worst recession since the 1930s may be subsiding and investors regain some confidence in U.S. equities. The two gauges rose more than 2% each over the past five days, capping a fourth straight week of increases.
While profits at S&P 500 companies are falling for a record eighth straight quarter, results have surpassed projections by an average of 10% in the current season. Per-share earnings have beaten estimates at three-quarters of the 447 companies in the S&P 500 that released second-quarter results since June 17, according to data compiled by Bloomberg.
American Express Co., Walt Disney Co. and General Electric Co. added at least 2.7% American International Group Inc. rallied 20% after its first profit since 2007 topped estimates. CBS Corp. and D.R. Horton Inc. climbed on analyst upgrades.
Economically speaking, employers shed 247,000 jobs in July, less than the 325,000 expected by analysts and far fewer than the 443,000 lost in June.
The unemployment rate fell to 9.4% from 9.5%, the first decline in over a year. Analysts were expecting it to rise slightly.
"It was the best reading on non-farm payrolls since before Lehman's collapse last September, which was the pivotal event that precipitated the crisis," said Jeff Kleintop, chief market strategist at LPL Financial.
Employment is seen as a lagging indicator in any recovery, according to economists. Yet the steady march higher of the unemployment rate over recent months has added to investor anxiety about the health of the economy.
The "Cash for Clunkers" incentive program got a new life late Thursday after the Senate approved $2 billion U.S. in additional funding. The popular program is aimed at spurring auto sales.
Treasury prices lost nearly a point, raising the yield on the benchmark 10-year note to 3.85% from late Thursday’s 3.76%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil dropped $1.01 to $70.89 U.S.
Gold prices sank three dollars to $960 U.S. an ounce.
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