Canadian stocks took off like a Saturn rocket Tuesday afternoon. Traders returned from a three-day weekend in a buying mood after U.S. and European stocks started the week with big gains yesterday.
The S&P/TSX Composite Index jumped 230.95 points, or 2.1%, to close August’s first session at 11,018.10, heights it hasn’t seen since late last September.
Mining stocks rallied, boosted by copper's sharp climb yesterday. Inmet added 4.2% to $47.05, First Quantum gained 3.5% to $74.23 and Teck Resources was up 2.5% to $29.05.
Industrials acquired strength as Canadian Pacific added 6.9% to $51.18 and Canadian National Railway was up 3.2% to $54.06.
Energy stocks were up as crude oil turned into positive territory. Suncor Energy moved ahead 4.6% to $36.44 after the company announced the completion of its merger with oil and gas company Petro-Canada on August 1.
In other corporate news, Kinross was up 2.9% to $21.87 after the company said employees at its subsidiary Compania Minera Mantos de Oro in Chile have voted in favor of a new collective agreement, ending a strike at the La Copia mine that began in July 2008.
Barrick Gold added 3.3% to $38.85 despite being downgraded to Sector Perform from Sector Outperform at CIBC World Markets.
Saputo picked up 6% to $24.94 after the company said its first-quarter net earnings totaled $84.8 million or $0.41 per share, up from $83.0 million or $0.40 per share in the prior-year period.
Orvana Minerals Corp. grew 2.6% to 78 cents after the company announced that it has extended its all-cash offer of $0.75 per share for all outstanding common shares of Kinbauri Gold Corp. The bid is now set to expire on August 17.
Adaltis Inc. dropped 6.3% to 7.5 cents after the company said it has filed a voluntary assignment in bankruptcy under the Bankruptcy and Insolvency Act (Canada) in order to effect an orderly liquidation of its assets, property and operations.
Domtar Corp. has surged 26.2% to $25.82 after the company said its net earnings for the second quarter were $48 million U.S. or $1.12 U.S. per share, up from $24 million U.S. or $0.56 U.S. per share in the prior-year quarter.
The Canadian dollar slid 0.65 cents to 93.14 cents U.S.
ON BAYSTREET
All but one of the 14 TSX subgroups were higher, led by global base metals, ahead 4.2%, metals and mining stocks charged up 3.7% and industrials powered ahead 3.3%.
Only a loss of 0.1% by the utilities sector kept things from being unanimous.
The TSX Venture Exchange gained 16.41 points, to 1,195.98, while the Nasdaq Canada Index rallied 16.08 points to 771.12.
ON WALLSTREET
In New York, stocks ended a choppy session higher Tuesday, as a better-than-expected housing market report helped investors extend the recent rally, leaving Wall Street at more than nine-month highs.
The Dow Jones Industrials finished the day 33.63 points in the black to 9,320.19. The S&P 500 index picked up 3.02 points to 1,005.65. The tech-rich Nasdaq composite struggled to gain 2.70 points, to 2011.31, still a 10-month high.
Both the Dow and the S&P 500 ended at the highest point since November.
Wall Street rallied Monday, starting off August on solid footing after the best July for the Dow and S&P 500 in two decades. Gains were driven by relief that the quarterly profit reports were generally better than expected and hopes that the economy is stabilizing.
The day's economic news was mixed, with a housing report showing improvement and a consumer income and spending report showing weakness.
The pending home sales index, from the National Association of Realtors, rose 3.6% in June versus forecasts for a rise of 0.7%. It was the fifth straight month of gain, the first time that's happened since 2003. Pending home sales rose a revised 0.8% in the previous month.
Personal income fell 1.3% in June, the Commerce Department reported Tuesday morning. That was worse than the 1% decline economists were expecting, according to a Briefing.com survey, and much worse than the previous month, when income surged on government stimulus efforts. Personal spending rose 0.4% in June, after a 0.1% increase in May. Economists thought it would rise 0.3%.
A separate report showed consumer bankruptcies soared 34% to a more than 3-1/2 year high versus a year ago, according to a report from the American Bankruptcy Institute.
One day after U.S. automakers reported July auto sales that improved from June levels, Toyota Motor reported a smaller-than-expected quarterly loss and said it expects smaller losses for the full year.
Automakers were able to report improved July auto sales largely due to Cash for Clunkers, the popular U.S. government program that provides a financial incentive for turning in a gas guzzler and buying a more fuel-efficient vehicle. The program is in danger of running out of money unless the Senate approves more funding.
In other company news, homebuilder D.R. Horton reported a fiscal third-quarter loss that was narrower than what analysts were expecting.
Swiss bank UBS reported a big quarterly loss that was worse than what analysts were expecting, as wealthy clients took a step back amid an ongoing tax dispute with the United States.
Among other movers, Dow component Caterpillar rallied 5% after the company's CEO reaffirmed the company's 2009 profit forecast, according to reports. He also outlined different scenarios for how the company might perform next year based on how long the recession stretches on.
In deals news, PepsiCo said it will buy its bottlers in a cash-and-stock deal worth $7.8 billion U.S., improving on an earlier $6-billion U.S. bid. Shares gained 4.6%.
Treasury prices slipped, raising the yield on the benchmark 10-year note to 3.69% from 3.63% late Monday. Treasury prices and yields move in opposite directions.
The price of a barrel of oil stumbled 16 cents to $71.46 U.S.
Gold prices were up $11 to $970 U.S. an ounce.
