Resource stocks continued to drive Toronto's main index higher in Tuesday afternoon trading. The market was on pace for its first gain in four sessions.
Soon before the closing bell, the S&P TSX Composite index was emphatically ahead 160.18 points, or 1.4%, to 11,584.79.
Mining stocks advanced, as HudBay soared 17.9% to $11.05 after announcing has found a new copper-gold zone at its Lalor project in Manitoba.
Cascades was unchanged at $7.75 after the company announced the acquisition of the Canadian assets of Sonoco Recycling, as well as the recovery assets of Yorkshire Paper Corp. through its subsidiary Metro Waste Paper Recovery.
Also in the sector, Teck Resources gained 4% to $30.48, First Quantum added 4.5% to $66.35 and Inmet was up 1.7% to $59.50.
The Energy Index added strength. Baytex Energy Trust rallied 2.1% to $24.78 after the stock was upgraded to "sector outperform" from "sector perform" at CIBC World Markets.
Canadian Hydro Developers announced has received further buyout proposals and that rival TransAlta is no longer in the lead. TransAlta is up 2.1% to $21.96, while Canadian Hydro Developers has added 1.6% to $5.16.
In other corporate news, Tim Hortons announced it has received shareholder approval to reorganize the company as a Canadian public company. The stock is down 1% to $30.45.
Sierra Wireless added 0.4% to $11.53 after the stock was initiated at "market perform" at BMO Capital Markets.
Linamar Corp. and Prime Minister Stephen Harper on Monday announced a partnership to invest in Linamar's Green & Fuel Efficient Powertrain Project. Linamar shares were up 7.5% at $13.80.
Thomson Reuters climbed 1.8% at $36.79 after the company announced that it will exercise its right to redeem about $600 million U.S. of outstanding debt securities.
Economically speaking, Canadian retail sales fell 0.6% in July, compared to a 1% rise in the previous month. Sales were expected to rise 0.5%. Excluding autos, sales fell 0.8%, compared to a revised 1.1% increase in June.
The Canadian dollar gained 0.83 to 93.57 cents U.S.
ON BAYSTREET
All but two of the 14 TSX subgroups finished in the black. Metals and mining stocks were the champion on this date, gaining 3%, followed by real-estate, ahead 2.1% and global base metals, up 2%.
The two groups that fell behind Monday’s close were information technology, stepping back 1.3% and health-care stocks, 0.1% to the bad.
The TSX Venture Exchange picked up 15.36 points to 1,280.36, while the Nasdaq Canada index tacked on 8.44 points to 843.30.
ON WALLSTREET
In New York, stocks rallied Tuesday, finding momentum after a choppy morning, with the Dow, S&P 500 and Nasdaq all pushing toward fresh one-year highs.
The Dow Jones Industrials gained 51.01 points by day’s end to 9,829.87, ending at the highest point since Oct. 6, 2008.
The S&P 500 index gained seven points, to 1,071.66, ending at the highest point since Oct. 3, 2008.
The Nasdaq composite index picked up 8.26 points to 2,146.30, its highest point since Sept. 26, 2008
The slow, steady move up is creating anxiety in investors that they are missing out, which in turn is drawing more money into the market, said Larry Glazer, managing director at Mayflower Advisors.
"As the equity market keeps going up, its giving investors a reason to put their money to work," he said. "The bulk of (mutual) fund flows have been fixed income driven, but they are now starting to move incrementally into equities."
In the short term, investors are also attuned to the Federal Reserve meeting that concludes Wednesday and the Dow's climb toward 10,000. Although 10,000 is not a key technical level, it is a significant psychological level.
Despite ongoing calls for a September slide, investors continue to use any declines as an opportunity to get back in.
Stocks have also benefited from the weakness of the dollar versus other major currencies.
Dollar-traded commodities and corresponding commodity stocks tend to rise when the greenback weakens. In addition, the weaker dollar impacts the stocks of companies that have a strong presence overseas.
One expert said that over the last six months it's been the most volatile names, leading the charge. He said that the leadership is now shifting to so-called higher quality names, as evidenced by the recent spikes in companies such as GE, AT&T and Verizon Communications.
Since bottoming at a 12-year low March 9, the S&P 500 has gained 57.4% and the Dow has gained 49%, as of Monday's close. After hitting a six-year low, the Nasdaq has gained 68.5%.
Stocks have risen during those 6-1/2 months on signs that the economy is starting to recover -- and due to extraordinary amounts of fiscal and monetary stimulus.
Dow gainers were fairly broad based, with 20 of 30 issues rising, including Chevron, Caterpillar, Alcoa and Hewlett-Packard
A number of financial stocks gained, too, including Dow components Bank of America and JPMorgan Chase.
Among other gainers, Citigroup rose 5% after Singapore sovereign wealth fund GIC said it sold half of its stake in the company. GIC had bought a 9% stake in Citigroup at its lows and opted to cash in on the recent market rally to earn $1.6 billion.
The Federal Reserve began its two-day policy meeting Tuesday, with an announcement expected Wednesday afternoon. The central bank is expected to hold short-term interest rates unchanged at levels near zero.
Fed chief Ben Bernanke said last week that the recession is likely over, but the labour market still has a long way to go.
On the economic front, July home prices rose 0.3%, according to a report from the Federal Housing Finance Agency (FHFA) released shortly after the start of trading. That was short of forecasts for a rise of 0.5%, according to Briefing.com survey of economists. Home prices rose a revised 0.1% in June.
Treasury prices were higher, lowering the yield on the benchmark 10-year note to 3.45% from Monday’s 3.48%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil grew $1.84 to $71.55 U.S.
Gold prices were up $11 to $1,016 U.S. an ounce.
