Resource stocks led Bay Street's main index back above the 10,800 mark on Thursday afternoon, following the direction of markets in the U.S. and Europe.
Shortly after the closing bell, the S&P/TSX Composite Index had soared 181.47 points, or 1.7%, to 10,841.34.
Mining stocks were up substantially to lead the way. Inmet rallied 4.4% to $48.64, Teck Resources was up 3.9% to $29.79 and First Quantum climbed 3.1% to $69.20.
Anvil Mining gained 4% to $2.85 after the company reported second-quarter net loss was $11.35 million U.S. or $0.13 U.S. per share, compared with a net income of $8.52 million U.S. or $0.12 U.S. per share in the prior-year quarter.
Materials stocks prospered and gold stocks also gained a fair bit of ground.
Kinross Gold was up 1.3% to $21.38 after the company reported that its second-quarter net earnings were $19.3 million U.S. or $0.03 U.S. per share, compared to net earnings of $26.0 million U.S. or $0.04 U.S. per share a year ago. Adjusted net earnings for the second quarter were $84.3 million U.S. or $0.12 U.S. per share, up from $49.5 million U.S. or $0.08 U.S. per share last year.
Pan American Silver surged 10.3% to $22.50 after the stock was upgraded to Buy from Neutral at UBS with a target price of $23. However, RBC Capital Markets cut its price target for the stock to $25 from $28 for the stock.
In other corporate news, Gildan Activewear rallied 6.7% to $19.66 after the company reported third-quarter net earnings of $41.5 million or $0.34 per share, lower than net earnings of $54.5 million or $0.45 per share reported in the same period of fiscal 2008. The previous year's results have been recast.
Stella-Jones fell 4.8% to $23.80 after the company reported its net earnings for the second quarter increased to $11.0 million or $0.87 per share from $10.1 million or $0.80 per share in the prior-year quarter.
Canadian Tire was flat at $63.05 after the company reported second-quarter revenue for the second quarter declined 5.1% to $2.32 billion from $2.45 billion in the prior year quarter. Adjusted earnings rose to $1.26 per share, up from $1.16 per share.
Scorpio Mining Corp. added 3.6% to 57 cents after the company reported second-quarter net earnings of $460,000 or breakeven per share, compared to a loss of $390,000 in the first quarter of 2009.
Danier Leather was unchanged at $5.00 after the company reported a fourth-quarter net loss of $3 million or $0.45 per share, narrower than a net loss of $3.02 million or $0.48 per share last year. Adjusted net earnings for the quarter narrowed to $3 million from $3.02 million in the year-ago quarter.
Research in Motion had its target price raised to $87 from $79 at Kaufman Brothers. The stock kept its Buy rating. Shares were off two cents at $77.98.
The Canadian dollar was 0.14 cents stronger, at 91.85 cents U.S.
ON BAYSTREET
All but two of the 14 TSX subgroups gained ground, metals and mining gaining the most, 4.8%, while global base metals vaulted 3.9%, and materials stocks advanced 2.8%.
Only real-estate stocks (1%) and consumer staples (0.4%) missed the party.
The TSX Venture Exchange gained 14.48 points of altitude, to 1,200.50, while the Nasdaq Canada Index added 3.76 points to 722.50.
ON WALLSTREET
In New York, stocks ended higher Thursday, after a choppy session, as the Fed's economic outlook and a positive government debt auction overshadowed a report showing a surprise drop in retail sales.
The Dow Jones Industrials finished the day ahead 36.58 points, to 9,372.34. The S&P 500 index gained 6.92 points to 1,012.77. The Nasdaq composite picked up 10.63 points to 2,009.35.
Wal-Mart's better-than-expected earnings report and a spike in financial shares kept a lid on any declines. The nation’s number-one retailer reported quarterly earnings Thursday.
On the upside, Wal-Mart earned 88 cents U.S. per share versus 87 cents U.S. a year ago and more than what analysts surveyed by Thomson Reuters expected. Wal-Mart also said that it expects current-quarter earnings in line with analysts' forecasts.
But revenue fell more than expected and the company said customers were cutting back. The Dow component also said that sales at stores open a year or more, also known as same-store sales, fell 1.2% in the quarter.
Nonetheless, investors focused on the positive and shares gained 2.6% Thursday.
Bank of America, Citigroup and Wells Fargo all gained, along with regional banks such as Fifth Third Bancorp and Regions Financial.
Economically speaking, indications that the global economy could be stabilizing provided investors with some optimism, but that was countered by Thursday's weak readings on the consumer.
On Thursday, both France and Germany posted GDP growth in the second quarter, surprising economists.
In the U.S., the Federal Reserve provided a little optimism Wednesday, saying that although economic activity is likely to remain weak, the decline is leveling out and financial market conditions appear to have improved. This seemed to echo recent reports showing the economy is stabilizing.
Future growth could be constrained by consumers, who continue to beef up their savings and avoid spending on non-essentials, as Thursday's retail sales and jobless claims reports made clear.
Retail sales fell 0.1% in July, the Commerce Department reported Thursday. The results were a surprise to economists who were looking for a rise of 0.7%, on average, according to a Briefing.com survey. Sales rose 0.8% in June.
Results would have been worse if not for the government's Cash for Clunkers program, which boosted auto sales. Retail sales excluding autos fell 0.6% in July versus forecasts for a rise of 0.1%. Sales without autos rose a revised 0.5% in June.
The report is worrisome, as consumer spending fuels two-thirds of GDP growth. So far, low prices and government stimulus have helped the economy stabilize, but without a pickup in spending, any recovery will be moderate at best.
Ford Motor said it is boosting production for the rest of the year to meet increased demand as a result of Cash for Clunkers.
Elsewhere, the number of Americans filing new claims for unemployment rose to 558,000 last week, surprising economists who were expecting jobless claims to drop to 545,000 claims.
However, the Labor Department report also showed that continuing claims, which measures people who have been receiving benefits for a week or more, fell to 6,202,000 from 6,343,000 in the previous week.
The housing market remains constrained, according to a new report released Thursday. Foreclosure filings jumped almost 7% in July from the previous month, according to RealtyTrac. Filings rose 32% from a year ago.
Treasury prices gained, lowering the yield on the benchmark 10-year note to 3.64%. Treasury prices and yields move in opposite directions.
The government is auctioning $75 billion U.S. in debt this week as part of its efforts to reduce the deficit and fuel its recovery efforts.
The first two auctions had mixed results. Tuesday's sale of $37 billion U.S. in three-year notes saw stronger demand than other recent auctions. Wednesday's auction of $23 billion U.S. in 10-year notes showed demand roughly in line with recent levels.
The price of a barrel of oil grew 79 cents to $70.95 U.S.
Gold prices added $4 to $957 U.S. an ounce.
