The Toronto Stock Exchange was up sharply Tuesday as traders bought up stocks across all sectors on rising hopes that European leaders will strengthen euro-zone banks.
The S&P/TSX composite index jumped 287.19 points, or 2.5%, to end the day at 11,875.55
The Canadian dollar was ahead 0.93 of a cent from Friday’s close to 97.24 cents U.S. as the pace of home construction picked up sharply last month.
Canada Mortgage and Housing Corp. said housing starts rose to a seasonally adjusted annual rate of 205,900 units. Strength was focused in the Atlantic region, Quebec and British Columbia and concentrated on multiple-unit urban starts such as condos, which increased 14.2%
Commodity prices softened after making solid advances Monday. But the TSX energy sector ran up, with Suncor Inc. rose 85 cents to $28.92 and Canadian Natural Resources advanced $1.00 to $31.20.
The base metals sector gained, even as copper prices gave back most of Monday’s advance with the December contract down nine cents to $3.28 U.S. a pound. First Quantum Minerals was up 46 cents at $16.16 and Teck Resources rose $1.49 to $35.14.
Railway stocks rose alongside energy and mining issues, with Canadian National Railways gaining $1.25 to $73.51 and Canadian Pacific Railway up $1.44 to $53.44.
Financials were also strong as Royal Bank moved up 56 cents to $47.86 and CIBC climbed $1.74 to $75.24.
Gold stocks were also higher as Barrick Gold Corp. improved by 80 cents to $49.24 and Kinross Gold Corp. climbed 41 cents to $14.57.
In corporate news, BlackBerry users in Europe have experienced problems with their smartphones for a second day. The glitches come after an unexplained problem cut off Internet and messaging services for large numbers of users across Europe, the Middle East and Africa on Monday.
But shares in Research In Motion, the device’s maker, rose 75 cents to $25.05 after Vic Alboini, chairman and chief executive of Toronto-based RIM shareholder Jaguar Financial Corp., said a total of 12 institutional shareholders which own about 8% of RIM stock are calling for changes at the company.
Air Canada shares dipped two cents to $1.39 as the carrier said it was "evaluating its options" in the face of a possible strike by its 6,800 flight attendants early Thursday. The attendants, represented by the Canadian Union of Public Employees, rejected a deal on the weekend that had been negotiated by CUPE. The flight attendants had also rejected a tentative deal CUPE negotiated with the airline in August.
Shares in engineering company Genivar were up $1.81 to $24.60 after it said Monday it has bought geomatics and surveying firm Le Groupe Giroux for an undisclosed amount.
ON BAYSTREET
The TSX Venture Exchange climbed 38.63 points to 1,511.13 while the Nasdaq Canada index gained 8.43 points to 452.58
All 14 Toronto subgroups pointed upwards throughout the day. Global base metals led the charge, up 4%, while metals and mining issues added 3.7%, and materials proved 3.6% stronger.
ON WALLSTREET
In New York, stocks were mixed Tuesday, with the technology sector bucking a broader decline, as investors await Slovakia's vote on the proposed overhaul of the European bailout fund.
The Dow Jones Industrials fell into the red 16.88 points, to close at 11,416.30.
The S&P 500 edged forward 0.65 points to 1,195.54, while the Nasdaq moved up 16.98 points to 2,583.03
The choppy trading come after stocks rallied sharply late Monday, as investors cheered a pledge from European leaders to unveil a plan for solving the euro-zone's debt crisis by the end of the month.
Stocks have advanced on four of the last five trading days, amid cautious optimism that a state-sponsored rescue of European banks is in the works.
But the tone remains cautious, as investors await the outcome of the Slovakian parliament's vote to overhaul the European Financial Stability Fund (EFSF) -- essentially a bailout fund for the region's most troubled nations.
The reforms must be ratified by all 17 euro-zone nations, and Slovakia is the last country to vote.
In another reminder of Europe's debt problems, Standard & Poor's cut the credit ratings or lowered the outlook on 15 Spanish banks.
Meanwhile, international monitors in Greece completed a review of the nation's finances, suggesting the latest installment of bailout money could be disbursed in early November.
Back in the U.S., the Federal Deposit Insurance Corp. is expected to release a draft of the Volcker Rule, which intends to take risky bets out of the financial system in hopes of preventing another crisis. The rule aims to rein in how banks use their own accounts to chase profits -- so-called proprietary trading.
The third-quarter reporting period unofficially got underway Tuesday, when Alcoa reported after the bell. Analysts expect earnings per share to more than double, as revenue edges up 18%, according to Thomson Reuters.
Meanwhile, shares of Dollar Thrifty fell 1.8%, after the rental car company said it plans to remain an independent company after seeking a buyer for over a year. Avis dropped out of the running last month, and Hertz didn't raise its offer.
Overall, S&P 500 company earnings are expected to have climbed almost 13% in the third quarter of 2011, according to earnings tracker Thomson Reuters. Revenues of the companies in the benchmark index are expected to have risen 10%.
The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 2.16% from 2.07% late Friday. Treasury prices and yields move in opposite directions. The bond market was closed Monday for Columbus Day.
Oil for October delivery tacked on 38 cents to $85.79 U.S. a barrel.
Gold futures for December delivery edged up 20 cents to $1,671 U.S. an ounce.
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