Canadian stocks remained moderately higher on Wednesday and enjoyed the first positive finish of the week. Strength in the gold sector led the way, offsetting another drop for financials.
The S&P TSX Composite index gained 11.75 points to end the day at 10,701.53.
Gold stocks soared and materials stocks added strength, too, as the precious metal gained ground. Agnico-Eagle Mines surged 10.8% to $69.09, Iamgold rallied 11.4% to $13.79, Eldorado jumped 8.8% to $11.82 and Goldcorp added 10.2% to $44.04.
Healthcare stocks rallied 5.4%, as MDS Inc. soared 30.2% to $8.36 after the company announced it will sell its MDS Analytical Technologies business to Danaher Corp. for $650 million in cash.
Financials lost ground with all of the big six banks sitting in the red. National Bank dropped 2.6% to $58.87, Toronto Dominion was down 2% to $64.74 and CIBC lost 1.9% to $60.12.
Bombardier jumped 7.8% to $4.13 after the aerospace and rail transportation solutions provider posted second-quarter net income attributable to shareholders of $198 million U.S. or $0.11 U.S. per share, compared to $251 million U.S. or $0.14 U.S. per share in the year-ago quarter.
Superior Plus Corp. fell 4.1% to $11.36 after the company said it has agreed to acquire certain assets from Sunoco for an aggregate purchase price of about $82.5 million U.S. in cash plus working capital.
Arbor Memorial Services added 8.7% to $19.56 after the company reported net earnings for the third quarter of $5.6 million or $0.52 per share, higher than $5.3 million or $0.49 per share in the earlier-year quarter.
The Canadian dollar was off 0.07 cents, to 90.47 cents U.S.
ON BAYSTREET
Of the 14 TSX subgroups, losers nosed out gainers eight to six. Financials were the worst off, losing 1.7%, real-estate and energy stocks slid 1.1% each.
Gold led the six gainers, leaping 10.1%, followed by materials, up 6.5% and health-care stocks, which were ahead 5.2%.
The TSX Venture Exchange strode ahead 22.13 points to 1,185.37, while the Nasdaq index picked up 6.99 points to 732.68.
ON WALLSTREET
In New York, stocks struggled Wednesday afternoon, one day after a big selloff, as jittery investors continued to worry that the market rally may have outpaced any recovery.
The Dow Jones Industrials settled back 29.93 points to finish at 9,280.67. The S&P 500 index slipped 3.28 points to 994.76. The tech-rich Nasdaq composite index fell 1.82 points to 1,967.07.
Stocks seesawed throughout the session Wednesday as investors mulled a pair of unemployment reports that signaled the pace of job cuts was moderating, ahead of Friday's bigger August jobs report.
With little else on tap to provoke investors in any direction, trading remained largely rangebound.
Today’s release of the minutes from the last Fed meeting also offered little inspiration. The minutes showed the central bankers thought the economy was stabilizing, after weakening in 2008 and early 2009, and that construction was starting to pick up, which is a good sign for the housing market.
The bankers also discussed the need to keep refining the Fed's so-called exit strategy after injecting billions into the financial system to help manage the meltdown.
Stocks slumped on Tuesday, with the three major gauges all losing around 2% as investors bet the six-month run has gotten ahead of the economic rebound.
Since bottoming on March 9 at a 12-year low, the S&P 500 has basically been on the rise, adding 52% through Monday. Stocks saw a minor retreat in late June and early July, with the S&P 500 losing about 7% heading into the start of the second-quarter financial reporting period. But, other than that small selloff, the direction has mostly been up.
Reports on Tuesday showed housing and manufacturing are recovering, but investors remain worried about the labor market and how rising joblessness will impact consumer spending. Consumer spending fuels two-thirds of economic growth, and economists say any recovery will be mild without the consumer's participation.
Economically speaking, two reports on the labor market were released Wednesday morning, two days ahead of Friday's bigger non-farm payrolls report.
Payroll services firm ADP said employers in the private sector cut 298,000 jobs from their payrolls last month after cutting a revised 360,000 in July. Economists were expecting 250,000 job cuts according to a Briefing.com survey.
Separately, outplacement firm Challenger, Gray & Christmas reported 76,456 job cut announcements in August, 21% fewer than in July.
Although both reports indicate the pace of job cuts has slowed, the economy is still far from creating jobs.
One expert said that most economists were forecasting no improvement until the end of this year or early next year.
He also said that if the pace of the recovery in the jobs market continues -- and business spending picks up -- the recovery could be stronger than current forecasts. But without those two factors, growth will remain sluggish.
In other economic news, a Labor Department report showed that non-farm productivity rose at a 6.6% annual rate during the second quarter versus the initially reported 6.4% pace. That was in line with forecasts.
Factory orders rose 1.3% in July, the Commerce Department reported. Orders rose a revised 0.9% in June. Economists thought orders would rise 2.2% in July.
In company news, Wells Fargo is set to repay the $25 billion U.S. in bailout funds it took from the U.S. government. The bank expects to pay it back from internal funds, rather than through issuing new shares.
Financial stocks as a sector retreated for the second session in a row, although the declines were fairly modest. The financial sector rallied through the summer on a mix of speculation and momentum.
Pfizer will plead guilty to a criminal charge related to how it promoted now-defunct pain killer Bextra. The Dow component will pay $2.3 billion U.S. to settle charges it wrongly marketed 13 medicines. In January, Pfizer said it took the charge but didn't specify why.
Shares of Sepracor rallied 28% on published reports that Japan's Dainippon Sumitomo Pharma plans to make a $2.7-billion U.S. bid for the drug maker.
Fellow Dow component Coca-Cola rallied, while JPMorgan, Merck, Walt Disney, and Home Depot declined.
In energy sector news, BP said Wednesday that it has made a "giant" oil discovery in the Gulf of Mexico. Although the company doesn't yet know the volume of oil present, it is thought to be in excess of three billion barrels.
Treasury prices went sharply up, lowering the yield on the benchmark 10-year note to 3.29% from Tuesday’s 3.37%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil was flat at $68.03 U.S.
Gold prices flew $22 higher to $979 U.S. an ounce.
