The Toronto stock market gained ground Friday afternoon, even as oil and metal prices backed off on worries that the U.S. economy continues to slow.
The S&P TSX Composite Index actually forged into positive territory by the closing, gaining 11.89 points to 11,722.07
The TSX was well off early lows, partly because of an advance in the financial sector ahead of earnings reports coming out from four of the big banks next week. National Bank, which reports Thursday, rose 94 cents to $57.29 while Sun Life Financial climbed 51 cents to $25.66.
Canadian Natural Resources lost 27 cents to $33.74 and Suncor Energy shed 36 cents to $32.63 after it said it is experiencing an outage at one of its hydrogen reformer units at the oil sands base plant in Fort McMurray, Alta. Canada’s biggest integrated energy company reported Friday that an assessment of the unit is underway to determine the cause of the outage and timing for when it will restart.
The base metals sector was down as demand worries weakened metal prices with the September copper contract in New York down three cents to $3.29 U.S. a pound. Teck Resources fell 25 cents to $34.40 and Lundin Mining stepped ahead five cents to $4.03.
Research In Motion Ltd. was also a drag on the TSX as the BlackBerry maker fell $1.34 or 2.6% to $51.14. RIM’s stock has plunged more than 13% this month as several countries put pressure on the company to allow access to email -- or risk having services shut down. The stock also fell Friday after Morgan Stanley analyst Ehud Gelblum reduced his rating on the stock to "underweight" from "overweight" on concerns about slipping market share.
North American markets put in a mixed performance this week. The TSX gained 193.82 points over five trading days, largely on the back of the resource sector as PotashCorp shares surged in the wake of a $38.6-billion U.S. hostile takeover bid by Australian resource giant BHP Billiton. The base metals sector jumped around 13% this week on hopes that other companies could be ripe for a takeover with a fat share price premium.
On Friday, PotashCorp said its board of directors will review formal documents filed by BHP Billiton related to its cash takeover offer, and make a recommendation to its shareholders. But until then, the Saskatchewan-based company said Friday it advises shareholders not to take any action on the bid.
The move comes after BHP Billiton said Wednesday it would take its offer directly to PotashCorp shareholders. Potash shares moved up $1.95 to $156.81.
Calgary-based farm products firm Agrium Inc. said Thursday it has entered into a definitive agreement to acquire Australian grain marketer AWB Ltd. for $1.1 billion, pushing out a competing bidder. Agrium said AWB’s board has deemed its bid superior to an earlier takeover proposal from Australian grain handler GrainCorp Ltd. That offer was reportedly worth around $829 million. Agrium shares advanced $1.01 to $72.02.
In economic news, Statistics Canada said the consumer prices rose 1.8% in the 12 months to July, following a 1.0% increase in June, largely affected by changes in consumption taxes in Nova Scotia, Ontario, and British Columbia.
Economists expected consumer prices to rise 2% annually. On a seasonally adjusted monthly basis, the nation's consumer prices rose 0.6% in July, following a 0.2% decline in June. Economists expected prices to rise 0.5% on-month.
Meanwhile, the Bank of Canada's closely watched core index advanced 1.6% in the 12 months to July, following a 1.7% rise in June. The seasonally adjusted monthly core index rose 0.1% in July, matching the increase in June.
The Canadian dollar gave back 0.83 cents on the day to 95.36 cents U.S.
ON BAYSTREET
All but four of the 14 TSX subgroups finished the day upward. Health-care stocks were 1% more robust, while financials chugged ahead 0.7% and telecoms rallied 0.5%.
The four laggards were weighed mostly by metals and mining, which slid 1.7%, energy, which slid 0.6% and global base metals, which suffered 0.1%.
The TSX Venture Exchange moved up 6.22 points to 1,479.62, for a gain on the week of 22.57 points or 1.6%, while the Nasdaq Canada index surrendered 14.49 points to close at 588.27.
ON WALLSTREET
In New York, equities fell Friday, on the verge of capping a second straight week of losses, as downbeat economic reports continued to raise fears of a double-dip recession.
The Dow Jones industrial average fell another 57.59 points to close out at 10,213.62. The big board gave back 89.53 points, or 0.9%, on the week.
The S&P 500 index decreased 3.94 points to 1,071.69. The damage to the much broader index was 7.56 points or 0.7% over five trading days.
The tech-rich Nasdaq composite index actually gained 0.81 points Friday to finish at 2,179.76, to add 6.28 points or 0.3% on the week.
Stocks extended their losses from the day before, after three key economic reports slammed confidence. Weekly jobless claims rose to their highest level since November, manufacturing activity in the Philadelphia region slowed, and a key measure of future economic activity was less than had hoped.
Weak economic reports have spurred worries about a slower recovery this summer, but bullish traders have been eager to put those fears on the back burner amid some strong earnings from Fortune 500 companies in the last few weeks. Now that the quarterly reports are tapering off, some of those gloomy economic reports are once again taking over the spotlight.
While takeover activity and merger deals are picking up steam, a sign that companies are preparing for "better times," some experts said the market is still debating whether the economy is headed for a double-dip recession.
Economically speaking, State unemployment turned gloomier in July, with jobless rates rising in 14 states and remaining unchanged in another 18. But 18 states and the District of Columbia saw a decrease in their unemployment rates, according to the Labor Department's monthly report on state unemployment.
The state unemployment picture was slightly worse than in June, when jobless rates eased in more than half of all U.S. states for a third straight month and only five states reported jobless rate increases.
The report came a day after a separate government reading showed the number of Americans filing for unemployment insurance unexpectedly surged last week.
Treasury prices faded, raising yields for the benchmark 10-year note to 2.61% from Thursday’s 2.58%. Treasury prices and yields move in opposite directions.
The price of a barrel of oil dropped 83 cents to $73.94 U.S.
Gold prices skidded six dollars to $1,230 U.S. an ounce.
