The Toronto stock market jumped more than 250 points mid-afternoon Tuesday as commodity stocks got a lift from data showing China’s manufacturing sector slowing less than thought while financials advanced following a strong earnings report from Bank of Montreal.
The S&P/TSX Composite Index ended Tuesday’s trading up 269.97 points, or 2.2%, to 12,338.33
The Canadian dollar gave back 0.05 cents to 101.23 cents U.S.
The financial sector was higher after Bank of Montreal kicked off quarterly earnings reports from the big Canadian banks. BMO turned in net income of $793 million, up 18% from the same time last year.
Its adjusted net income was $843 million, or $1.36 per share, four cents higher than analyst estimates. BMO’s revenue was $3.27 billion, up 13% from the third quarter of fiscal 2010 and its shares climbed $2.30 to $59.65.
It was the first quarterly report that included a contribution from Milwaukee-based bank Marshall & Ilsley Corp., which BMO bought in December. The deal closed in July, providing BMO with about 26 days of contributions from M&I.
Elsewhere in the sector, Royal Bank, which reports Friday, advanced $1.49 to $49.97.
Canadian Natural Resources gained $1.99 to $34.89 as the energy giant said its Horizon oilsands operation has resumed sales of synthetic crude, which were interrupted by a fire at the processing plant in January. It says it’s ramping up production and expects to reach full capacity of 110,000 barrels per day of synthetic crude by next week.
Cenovus Energy was ahead $1.70 to $34.47.
The base metals sector rose as hopes for higher demand from China helped push the September copper contract on the Nymex up four cents to $4 U.S. a pound. Teck Resources climbed $1.83 to $39.40, HudBay Minerals rose 63 cents to $12.49 and Ivanhoe Mines shares jumped $3.40 to $20.52.
Among gold issues, Barrick Gold Corp. lost $1.54 to $50.10 and Goldcorp Inc. faded $2.86 to $50.79.
Elsewhere in the oilpatch, PetroMagdalena Energy Inc. reported that it has discovered a new light-oil field with its Petirojo-1 discovery well in Colombia and its shares slipped seven cents to 97 cents.
On matters economic, retail sales continue to purr in Canada. Figures released this morning by Statistics Canada showed that retail sales increased 0.7% in June to $37.8 billion, the third straight monthly hike. Higher car and truck sales powered the improvement.
ON BAYSTREET
The TSX Venture Exchange inched back 5.89 points to 1,760.87, while the Nasdaq Canada index improved 12.29 points to 493.82
In Toronto, all but two of the 14 subgroups gained ground, led by metals and mining, picking up 6.8%, while global base metals climbed 4.9%, and energy stocks were up 4.2%.
The two laggards were gold, down 3.9%, and materials, off 0.7%.
ON WALLSTREET
In New York, stocks started out slow but were in full-on rally mode by midday Tuesday, following a report from the FDIC that showed the number of failing banks shrank for the first time in nearly five years.
The Dow Jones Industrials accelerated 322.11 points, or 3%, to finish at 11,176.80.
The S&P 500 was up 38.53 points to 1,162.35, while the Nasdaq grew 100.68 points to 2,446.06
Stocks were also lifted by a surge in the price of oil, which rose more than 2% -- helping to boost the energy sector, most notably Exxon Mobil and Chevron.
Beaten-down Bank of America was under pressure once again, with shares falling 4%. Goldman Sachs and Travelers also posted modest losses.
Shares of Apple rose 3% after Reuters reported that the company's suppliers were building a cheaper version of the iPhone 4, citing unnamed sources. Reuters also said Apple is aiming to launch the iPhone 5 by the end of September.
Financial stocks have been getting hammered over the past month on concerns that the U.S. economy may be slipping into a recession and that some banks may have to raise additional capital.
Bank of America has been the focus of a lot of investors' attention in particular. Its shares hit a new 52-week low earlier in the session before turning around.
But traders embraced a little bit of positive news out of the financial sector, after the FDIC said its list of problem banks got smaller for the first time since the financial crisis, falling by 23 institutions to 865.
A better-than-expected Chinese manufacturing economic report was helping the broader market.
An HSBC survey of manufacturers in China showed that factory activity slowed for a second straight month in August, but the contraction was less than it was in July.
Economically speaking, the Commerce Department said new-home sales declined by 0.7% to an annual rate of 298,000 in July, marking the third straight month of declines. The figure was also slightly below forecasts.
The price on the benchmark 10-year U.S. Treasury fell back a bit, lifting the yield to 2.11% from Monday’s 2.09%. Prices and yields move in opposite directions.
Oil for September delivery gained $1.46 to $85.88 U.S. a barrel
Gold prices slid $65.40, or about 3%, to $1,824.30 U.S. an ounce, after the dizzy heights of the last few days.
