Equity markets in Toronto blasted out of the starting blocks on Monday morning on Monday after Larry Summers' surprise withdrawal of his candidacy from the race to become the next chairman of the U.S. Federal Reserve raised investors' hopes of a relaxed taper of the central bank's monetary easing policy.
The S&P/TSX composite index jumped 106.26 points to open trading Monday at 12,829.66
The Canadian dollar was up 0.16 cents to 97.09 cents U.S.
Aimia struck a deal with Toronto-Dominion Bank and Canadian Imperial Bank of Commerce under which TD will be the issuer of Aeroplan credit cards and acquire half of CIBC's existing portfolio, with CIBC retaining the rest. Aimia shares vaulted 83 cents to $17.46.
Barrick Gold could see its stock rebound if it attracts an activist shareholder who prompts management to quicken its pace in shedding assets, according to a story in Barron's. Barrick shares hiked 39 cents to $18.73
A handful of potential bidders, including private equity firms, are lining up to look at BlackBerry, but initial indications suggest that interest is tepid and buyers are eyeing parts of the smartphone maker rather than the whole company. BlackBerry shares gained 11 cents to $10.72.
Bombardier Inc is targeting Monday for the first flight of its all-new CSeries jetliner, weather permitting. Bombardier shares added a dime to $5.09
Mining group Anglo American has pulled out of the Pebble copper project in Alaska, one of the largest undeveloped copper deposits in the world but also an environmentally challenging operation that has been studied for almost three decades. The news was of particular interest to concerns like Northern Dynasty, whose shares declined 75 cents to $1.58.
Poland's biggest refiner PKN Orlen said it agreed to buy upstream company TriOil Resources for 563 million zlotys ($1.83 billion), in a deal to help turn it into an oil producer. TriOil shares gave back 23 cents to $2.83.
On the economic slate this morning, Statistics Canada reported that foreigners bought more Canadian securities, adding $6.1 billion to their holdings in July, following a $15.4-billion divestment in June. Meanwhile, Canadian investment in foreign securities slowed to $0.9 billion and focused on bonds.
Also, figures released by the Canadian Real Estate Association showed home sales rose 2.8% from July to August. Actual activity came in 11.1% above levels in August 2012.
ON BAYSTREET
The TSX Venture Exchange gained 1.34 points to 942.84
All 14 Toronto subgroups were higher in the early going, led by information technology, up 2.3%, metals and mining, ahead 1.4%, and real-estate, gaining 1.3%.
ON WALLSTREET
The S&P 500 is once again approaching a record high, as investors welcomed the withdrawal of Larry Summers from the race to become next chairman of the Federal Reserve.
The Dow Jones Industrials ballooned 135.04 points to begin the week at 15,511.10
The S&P 500 index gained 12.68 points to 1,700.67. The NASDAQ poked ahead 15.02 points to 3,737.20
The blue-chip index rose nearly 1% in early morning trading Monday and is just a handful of points below its all-time peak of 1,709 from early last month.
Investors are excited at the prospect of top contender Janet Yellen taking over from current Fed chairman Ben Bernanke, since she is widely expected to pursue a similar policy of stimulating the economy to bring the unemployment rate down. Yellen is currently the Fed's vice chair.
There had been some concerns that Summers, who was widely viewed as the frontrunner for the top Fed job, would have been more aggressive at pulling back on the monetary stimulus measures that have been pumping cash into the system and supporting stock markets around the world.
Meanwhile, Saturday's announcement that the U.S. and Russia had created a framework to eliminate Syria's chemical weapons also lifted investors' mood.
On the economic front, manufacturing activity in New York unexpectedly slowed in September, according to report from the New York Federal Reserve. A separate report showed that industrial production rose the most in six months, although slightly slower pace than estimates, while capacity utilization grew in line with forecasts.
Prices for the 10-year U.S. Treasury were up sharply, lowering yields to 2.79% from Friday’s 2.90%. Treasury prices and yields move in opposite directions.
Oil prices dropped $1.25 to $106.96 U.S. a barrel.
Gold prices strengthened $9.40 at $1,318 U.S. an ounce.
