Canadian stocks traded sharply higher on Monday after progress in the euro-zone debt negotiations and Chinese manufacturing data lifted investor sentiment.
The S&P/TSX composite index concluded the day ahead 212.79 points, or 1.8%, to 12,162.28
The Canadian dollar, meanwhile, moved forward 0.50 cents to 99.64 cents U.S., a day before the Bank of Canada's scheduled announcement on interest rates. The central bank is widely expected to leave its key rate unchanged at 1%
European leaders said Sunday that discussions were progressing over European bank recapitalization, Greek debt restructuring and the euro-zone bailout fund. A final package of measures is expected at a second summit on Wednesday.
Metals and mining stocks were up sharply, as gold futures tracked the rise in U.S. stocks. Shares of Teck Resources Ltd. added 5.8% to $36.80 while shares of First Quantum Minerals Ltd. picked up 11.5% to $17.83.
Among notable movers, shares of Silvercorp Metals Inc. soared as high as 17.4% to after the miner said an audit of the company’s accounting practices backed the company’s financial statements against recent fraud allegations.
Crude-oil futures also rallied on optimism, lifting Toronto’s energy sector. Shares of heavyweight Suncor Energy Inc. gained 4.3%, to $31.58 with shares of Canadian Oil Sands Ltd. adding 3.6% to $23.32.
ON BAYSTREET
The TSX Venture Exchange improved 27.42 points to 1,560.33 while the Nasdaq Canada index eked ahead 2.84 points to 446.11
Of the 14 Toronto subgroups, 10 were positive on the day, metals and mining stocks enormously so, vaulting 7.2%. That sector’s cousins in global base metals rocketed 6%, while materials were 3.7% stronger.
The four laggards were weighed mostly by health-care, 5.6% sicker, while consumer staples trailed Friday’s close by 0.5% and telecoms slid 0.4%.
ON WALLSTREET
In New York, stocks advanced Monday, as investors welcomed two merger announcements and strong earnings from Caterpillar.
The Dow Jones Industrials gained 104.83 points to end the session at 11,913.60
The S&P 500 grew 15.94 points to 1,254.19, while the Nasdaq Composite Index leaped 61.98 points to 2,699.44.
Caterpillar led the Dow's gains, after the equipment manufacturer reported record revenue for the third quarter and issued a strong outlook. Caterpillar said the euro-zone debt problems and slowing U.S. economic growth are "concerning," but they are not signaling "the onset of recession."
Financial stocks were also big winners, with Citigroup, JPMorgan Chase, Bank of America shares all rising about 3%.
Investors were cautiously optimistic about progress made toward addressing Europe's debt crisis.
Europe's top leaders said Sunday that they were getting closer to finalizing a plan to solve the continent's debt crisis. But with a final agreement not expected before Wednesday, the actual details remained under wraps.
On Friday, U.S. stocks rallied to their highest levels since early August, as investors grew increasingly hopeful about a resolution to Europe's debt crisis.
Friday's gains pushed the Dow back into positive territory for 2011, with all three indexes on track for their best monthly performance in more than a year.
Meanwhile, Monday's increases drove the Nasdaq back into the black for the year, and the S&P 500 was just a few points shy of the breakeven line.
Health insurer Cigna agreed to acquire HealthSpring for $3.8 billion U.S., sending shares of the health care medical plan provider up more than 30%.
Shares of RightNow Technologies spiked after Oracle said it will buy the company for $1.5 billion U.S., or $43 U.S. a share.
Shares of WebMD advanced, after an SEC filing revealed that Carl Icahn, of Icahn Enterprises, owns 7.94% of the health care information site. Icahn said he believes that WebMD shares are "undervalued from a long-term perspective."
Netflix will announce results after the markets close, and is expected to report earnings per share of 94 cents U.S., up from 70 cents U.S. a year earlier.
On the economic front, U.S. housing finance agencies -- the Federal Housing Finance Agency, with Fannie Mae and Freddie Mac -- unveiled changes aimed at helping troubled homeowners refinance mortgages.
The new rules will allow severely underwater borrowers, who owe more than 125% of the market value of their homes, to get new loans.
New York Fed President William Dudley called for policymakers to make it easier for homeowners to refinance at lower mortgage rates and prop up home prices, while speaking at Fordham University on Monday.
The price on the benchmark 10-year U.S. Treasury slid, raising the yield to 2.23% from 2.20% late Friday. Treasury prices and yields move in opposite directions.
Oil for October delivery travelled higher by $3.15 to $90.55 U.S. a barrel
Gold futures for December delivery rose $16.20 to settle at $1,652.30 U.S. an ounce.
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