Bay Street stocks have moved notably higher on Thursday, boosted by strength in the resource sectors. The market had plunged to a two-month low on Wednesday
The S&P TSX Composite Index recovered 120.67 points, to end the day at 9.774.12.
Mining stocks have surged as copper jumped more than 3% on the Comex. HudBay rallied 9.8%, First Quantum is up 6% to $52.43 and Teck Cominco has gained 3.2% to $18.44.
Energy stocks have rallied and recovered some of their recent losses. Canadian Natural Resources has gained 2.6% to $55.05, Suncor is up 2.9% to $31.33 and Encana has gained 2% to $53.20.
Materials and gold stocks have both risen, as New Gold added 4.3% to $2.90 and Iamgold was up 1% to $10.76 to lead the gainers.
On the corporate front, Velan added 11.7% to $12.40 after the company posted first-quarter net income of $14.3 million or $0.64 per share, compared to $7.3 million or $0.33 per share in the prior-year period. Sales for the period were $120.4 million, compared to $139.4 million in the previous-year period.
Richelieu Hardware Ltd. lost 0.5% to $17.40 after the specialty hardware maker reported its second-quarter net income declined to $7.31 million or $0.33 per share from $9.1 million or $0.40 per share in the prior-year quarter.
Research in Motion was up 1.4% to $77.51 after the stock was upgraded to Buy from Hold at Kaufman Bros.
Canadian Pacific slipped 2.3% to $39.14 after its target price was raised to $38 U.S. from $35 U.S. at RBC Capital Markets. The stock's rating was reiterated at Sector Perform.
Sandvine Corp. shares plummeted 11.1% to $1.04 after the company reported a wider second-quarter net loss of $5.63 million or $0.042 per share compared with $4.63 million or $0.034 per share in the year earlier period.
There was positive housing sector news Thursday morning. Canada Mortgage and Housing Corp. announced that the seasonally-adjusted annual rate of housing starts increased to 140,700 units in June from 130,300 units in May.
CMHC said housing starts are expected to improve throughout 2009 and over the next several years to gradually become more closely aligned to demographic demand, which is currently estimated at about 175,000 units per year.
The Canadian dollar gained 0.41 cents to 86.05 cents U.S.
ON BAYSTREET
All but two of the 14 TSX subgroups enjoyed gains, the biggest by metals and mining, up 4.5%, followed by energy stocks, ahead 2.6% and global base metals, advancing 2.2%.
The two laggards were consumer staples, which lost 0.7%, while industrials tailed off 0.3%.
The TSX Venture Exchange added 8.80 points, to 1,042.82, while the Nasdaq Canada Index increased 8.64 points to 647.74.
ON WALLSTREET
In New York, bank, tech and commodity shares led an advance Thursday afternoon, as investors welcomed Alcoa's narrower-than-expected quarterly loss at the start of the quarterly reporting period.
The Dow Jones Industrials average eked out a gain of 4.76 points, to finish up at 8,183.17. The S&P 500 index gained 3.12 points to 882.68. The Nasdaq increased 5.38 points to 1,752.55
Bets that the economy is stabilizing have given way to concerns that the stock market has gotten ahead of any recovery. Wall Street will be listening to a variety of corporations over the next week as they report quarterly results and also give their outlook on future profits and the state of the economy.
Experts said that after the big rally, investors remain on the defensive, staying in cash and waiting for concrete evidence that the economy is starting to turn around.
Dow component Alcoa began the corporate reporting period late Wednesday. The aluminum producer said it lost 26 cents U.S. per share versus a profit of 66 cents U.S. a year ago as the global recession hurt pricing and demand. But the decline was narrower than the loss of 38 cents U.S. per share analysts expected, according to Thomson Reuters.
Alcoa shares were off 2% Thursday afternoon.
S&P 500 companies are expected to see profits decline by 36% from a year ago, according to the latest figures from Thomson Reuters.
The economic slowdown continued to take its toll on consumer spending, with clothing retailers and luxury item merchants especially feeling the impact of the recession.
Among the notable decliners, Abercrombie & Fitch said same-store sales fell 32% versus a year ago, topping forecasts for a drop of 26.6%. Same-store sales is a key retail sector indicator that measures sales at stores open a year or more.
Victoria's Secret owner Limited Brands said sales fell 12% versus forecasts for a drop of 7.9%.
Merck and Portola Pharmaceuticals said they will develop and market an oral blood thinner used to prevent stroke in heart patients. Merck will pay Portola $50 million U.S. up front and potentially an additional $420 million U.S. down the line. Merck, a Dow component, fell 3.6%.
But a variety of other Dow stocks rose, including Chevron, Dupont, IBM, Bank of America and JPMorgan Chase.
Economically speaking, the Labor Department reported that 565,000 people filed for first-time unemployment benefits in the week ended July 4. This was significantly lower than the 617,000 claims from the week prior. It was also lower than the 603,000 claims that were forecast by a consensus of economists surveyed by Briefing.com.
May wholesale inventories are expected to have fallen 1% after dropping 1.4% in the previous month. The Commerce Department report is expected to show that inventories plunged for a ninth straight month.
Treasury prices faded, raising slightly the yield on the benchmark 10-year note to 3.39%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil grew 27 cents to $60.45 U.S.
Gold prices gained $7 an ounce to $916 U.S.
