The Toronto stock market slowly gathered strength throughout the day, after a slow start, and finished solidly in the green, even after disappointing U.S. consumer and housing data deepened worries that the American economy could fall back into recession
The S&P TSX Composite Index finished ahead by 90.77 points at 11,648.12
CIBC shares moved $2.96 higher, or 4.4%, to $69.77, as the bank reported net income rose to $640 million in the fiscal third quarter, up from $434 million a year ago, as revenue held steady and the bank took fewer provisions for credit losses.
Excluding one-time items, the bank’s earnings were equal to $1.66 per share, beating consensus analyst expectations of $1.53 per share, according to Thomson Reuters.
The financial sector had retreated on Tuesday after Bank of Montreal reported a third-quarter profit of $669 million, up 20% from a year ago but short of analyst expectations.
On Wednesday, BMO rose 85 cents to $56.35 after falling about 6% on Tuesday while TD Bank fell three cents to $69.38 amid uncertainty about earnings reports from other big banks this week and next.
Energy stocks were weak even as oil prices bounced off earlier lows that came in the wake of data from the Energy Information Administration showing higher crude and gasoline inventories in the U.S.
Suncor Energy lost 22 cents to $31.89, but Canadian Natural Resources moved higher by 16 cents to $33.07. Demand worries have pushed crude prices down 13% over the past three weeks.
The telecom sector was a major decliner, with Rogers Communications falling 98 cents to $37.03 after an analyst at TD Bank cut his rating on the stock to "hold" from "action list buy."
BCE Inc. lost 54 cents to $32.74.
Economic worries continued to punish copper prices with the September contract on the Nymex down two cents to $3.22 U.S. a pound.
Among base metals stocks, Quadra FNX Mining forged ahead seven cents to $10.54 while Taseko Mines gained 21 cents to $4.56.
In the gold sector, Goldcorp Inc. was up $1.52 to $44.55.
In other news, BHP Billiton Ltd., the world’s biggest miner, said Wednesday its full-year earnings more than doubled to $12.7 billion U.S. as the company slashed its debt and enjoyed record demand for iron ore.
Last week, BHP launched a hostile $38.5-billion U.S. takeover offer for Canadian fertilizer company Potash Corp. of Saskatchewan Inc. On Monday, PotashCorp said its board voted unanimously to reject the bid.
BHP Billiton’s chief executive said Wednesday that PotashCorp would fit well within the diversified mining company’s global strategy but adds that BHP is prepared to abandon its takeover bid if necessary.
BHP shares were down 36 cents to $65.06 U.S. in New York while PotashCorp shares declined $3.38 to $154.42 on the TSX.
Shares in Research In Motion rose 69 cents to $50.63 after the BlackBerry maker confirmed it has acquired California-based Cellmania, which produces software to manage virtual application stores and their content. Financial terms were not disclosed.
The Canadian dollar reversed its skid, gaining 0.04 cents to 94.30 cents U.S.
ON BAYSTREET
All but three of the 14 TSX subgroups gained ground on the day. Gold surged 2.9%, while metals and mining tacked on 2.1% and materials strengthened 2%,
The three laggards were telecoms, which dropped 1.4%, while utilities shed 0.4% and consumer staples gave back 0.3%.
The TSX Venture Exchange moved upward 5.93 points to 1,462.78, while the Nasdaq Canada index gained 7.59 points to 578.92.
ON WALLSTREET
In New York, stocks finished higher Wednesday after spending most of the day in the red, following another round of dismal housing news.
The Dow Jones industrial average regained 19.61 points to close at 10,060.06.
The S&P 500 index picked up 3.46 points to 1,055.33. The tech-rich Nasdaq composite index gathered 17.78 points to 2,141.54
Stocks sold off sharply immediately after the housing data but managed to recoup some losses as homebuilding and housing material stocks crept higher.
Lennar Corp., KB Home and Toll Brothers all gained more than 3%.
But the same news that lifted homebuilding stocks battered the financial sector, with big names like Wells Fargo and Citigroup edging lower.
On Tuesday, stocks sank after a 27% plunge in existing home sales fueled worries about an economic slowdown, sending the Dow 134 points lower on the day.
Last week, the Dow and S&P ended lower for a second straight week as disappointing economic reports slammed investor confidence.
Homebuilder Toll Brothers booked its first quarterly profit in three years on Wednesday, thanks largely to a boost from the homebuyer tax credit.
The company said net income was $27.3 million U.S. in the quarter, or 16 cents U.S. per share, after losing $472.3 million U.S., or $2.93 U.S. a share, a year ago. Shares of Toll Brothers rose 6%.
Economically speaking, new home sales unexpectedly plummeted to the lowest level on record in July, dropping 12.4% in July, the government reported. Economists had expected sales actually to go higher.
The disappointing data comes right on the heels of another dismal housing report that showed a sharp drop in existing home sales, considered the core of the residential real estate market.
Meanwhile, new orders for long-lasting goods fell short of forecasts, edging up a modest 0.3% in July. Economists had expected the government report to show a 3% jump.
Treasury prices sagged, raising yields for the benchmark 10-year note to 2.54% from Tuesday’s 2.50%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil moved up $1.19 to $72.82 U.S.
Gold prices gained nine dollars to $1,242 U.S. an ounce.
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