The Toronto stock market racked up a triple-digit boost Tuesday morning as investors regained some confidence about Europe’s economy and commodity stocks made significant strides.
The S&P/TSX Composite Index leaped 183.96 points, or 1.6%, to approach noon at 11,723.66
The Canadian dollar gained 0.90 cents to 97.21 cents U.S., after data showed Canada’s inflation was in line with expectations in November.
In domestic news, TransCanada Corporation, a major pipeline operator and power producer, has expanded its alternative energy business with a deal to buy nine solar power projects in Ontario for $470 million. Shares added 25 cents to $43.69.
On the economic scene, Statistics Canada reported the country’s annual inflation rate remained relatively high at 2.9% last month as Canadians continued to pay considerably more for food and gasoline than they had 12 months earlier.
Statistics Canada added that grocery prices were up 5.7% in November compared with a year ago as consumers saw double-digit increases for such basics as fresh vegetables and bread. The figures included a 1.3% jump from October alone.
ON BAYSTREET
The TSX Venture Exchange jumped 17.79 points to 1,425.18, while the Nasdaq Canada index gained 8.31 points to 354.90
All 14 Toronto subgroups popped, led by metals and mining, gaining 3.4%, global base metals, moving up 3.3%, and materials, ahead 2.7%.
ON WALLSTREET
In New York, stocks raced higher Tuesday as shares of big banks rebounded and investors welcomed a better-than-expected report on the housing market.
The Dow Jones Industrials vaulted 282.30 points, or 2.4%, to break for lunch at 12,048.60
The S&P 500 picked up 30.53 points, to 1,235.88, while the Nasdaq Composite charged up 71.79 points to 2,594.33
Banking stocks were among the best performers in the early going, after the sector dragged down the broader market Monday.
Bank of America was up 2.8% to $5.18 U.S. a share, one day after the stock fell below $5 U.S. per share. Citigroup, Goldman Sachs, JPMorgan, Morgan Stanley and Wells Fargo all moved higher.
Meanwhile, investors also welcomed a few encouraging headlines out of Europe, including a surprisingly strong auction of Spanish debt. The government in Madrid sold €5.6 billion in short-term bills at interest rates far below previous auctions.
In addition, a report showed German consumer confidence remains strong and the Swedish central bank cut interest rates to 1.75% from 2%.
Trading volumes are expected to remain light as many investors have already closed their books for the year. That could make for a choppy session as low trading volumes can cause dramatic swings in the market.
Shares of Apple were up 1%, after the U.S. International Trade commission ruled Monday that the software in some of HTC's Android smartphones violated one provision of an Apple patent, and that those phones would no longer be allowed into the U.S.
Google shares were up slightly, after the company said it would acquire a portfolio of solar photovoltaic (PV) facilities with KKR. The deal brings Google's total investment in renewable energy projects to more than $915 million U.S.
Food producer General Mills reported quarterly earnings of 76 cents U.S. per share, slightly missing estimates. Analysts surveyed by Thomson Reuters expected earnings of 79 cents U.S. per share.
Late Monday, AT&T announced it had abandoned its $39-billion U.S. bid for T-Mobile, a deal that would have created by far the nation's largest wireless company.
Economically speaking, U.S. housing starts increased by 9.3%, to an annualized pace of 685,000 in November, from 627,000 in October, with building permits rising 1.8% to 681,000 compared to last year.
Market expectations going into the report had been for much fewer housing starts at 635,000
The price on the benchmark 10-year U.S. Treasury sagged, pushing the yield up to 1.91% from 1.81% Monday. Treasury prices and yields move in opposite directions.
Oil for January delivery progressed $2.92 to $96.80 U.S. a barrel.
Gold futures for February delivery fell $16.40 to $1,613.10 U.S. an ounce.
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