The Toronto stock market headed for a higher open Friday following moves by the European Central Bank to lighten the cost of borrowing for euro-zone countries by buying government bonds.
The S&P/TSX Composite index moved up 88.23 points to open Friday at 12,227.96
The Canadian dollar gained 0.36 cents Friday morning to 102.11 cents U.S.
In corporate news, Lululemon Athletica Inc. reported quarterly net earnings were $57.2 million or 39 cents per share. That compared with net earnings of $38.4 million or 26 cents per share in the second quarter of fiscal 2011. The Vancouver-based activewear retailer also reported revenue up 33% to $282.6 million. It also raised its full-year revenue projection.
North American markets registered solid gains Thursday in the wake of the European Central Bank’s move to get a grip on the euro-zone’s debt crisis.
The plan amounts to a commitment to buy unlimited amounts of short-term bonds from euro countries that request help. Ostensibly, the plan is meant to ease the financial pressures on Spain and Italy by giving them time to reduce their debt and reform their economies.
The ECB had been pressured to take action after Spain and Italy became the latest countries forced to pay yields in the seven per cent range on their benchmark 10-year bonds earlier this year, a level that raised worries those countries could be forced to seek a bailout.
The ECB plan seemed to be working Friday as Spain saw its cost of borrowing fall.
Investors think Spain will make a formal request to tap the new program within weeks, which could ease the pressures in the euro-zone’s fourth-largest economy.
On the economic docket, Statistics Canada reported this morning that this country added 34,000 jobs in August, mostly due to there being more part-time work. The unemployment rate held steady at 7.3%.
The agency also told us that building permits were issued worth just over $6.8 billion in July, down 2.3% from June.
ON BAYSTREET
The TSX Venture Exchange gained 13.23 points to 1,271.53.
All but three of the 14 Toronto subgroups were higher at the outset. Metals and mining expanded 5%, while global base metals strengthened 4.2% and materials were up 2.6%.
The two laggards were telecoms, off 0.5%, and industrials, down 0.2%, while consumer staples were flat at the outset.
ON WALLSTREET
U.S. stocks opened mixed Friday, as investors digested a disappointing jobs report but hoped the weakness would prompt the Federal Reserve to jumpstart the slowing economy with stimulus when it meets next week.
The Dow Jones industrial average nipped up 1.03 points to open the session at 13,293.
The S&P 500 index gained 3.63 points, to 1,435.75, and the tech-heavy Nasdaq Composite Index was higher by 0.25 points to 3,136.06.
Intel Corp lowered its guidance for third-quarter revenue, citing "weaker than expected demand in a challenging macroeconomic environment." Shares slid more than 2% on the news.
Shares of Pandora plunged 20% after Apple announced that it plans to launch a competing live streaming music option.
Gunmaker Smith & Wesson Holding Corp reported earnings and raised its full-year forecast Thursday, sending shares surging almost 20%
Shares of Amazon ticked higher after the company unveiled four new tablets on Thursday. Despite the new products, much of the Amazon chatter focused on what the company didn't announce: a new phone.
Economically speaking, the U.S. Labor Department reported that 96,000 jobs were added in August, well below the 120,000 jobs that economists were looking for. The Labor Department also revised the job creation estimates for June and July, painting an even bleaker picture.
The unemployment rate ticked down to 8.1% from 8.3%, but only as a result of a significant drop in the number of people looking for jobs. Economists were expecting the jobless rate to hold steady at 8.3%.
The price on the benchmark 10-year U.S. Treasury regained strength, lowering yields to 1.61% from Thursday’s 1.67%. Treasury prices and yields move in opposite directions.
Oil prices for September delivery dipped $1.11 to $94.42 U.S. a barrel.
Gold futures for December delivery rose $26.20 to $1,731.80 U.S. an ounce
