Stocks on both sides of the line roared ahead, amid reports both Canadian and U.S. governments had a firm hand on the economic recovery, and making progress on the shoulders of the financial sector.
The S&P TSX Composite Index ended the day 149.29 points higher to 8,908.42.
U.S. stocks rose, extending a global rally, as President Barack Obama prepared to set up a so-called bad bank to absorb toxic investments and Yahoo! Inc. reported better-than-estimated earnings.
North of the border, Finance Minister Jim Flaherty’s budget Tuesday promised billions of dollars for infrastructure, tax cuts for individuals and businesses, changes to the country’s Employment Insurance program, and a host of other stimulus measures.
Liberal Party Leader Michael Ignatieff at a news conference, while pointing up the document’s deficiencies, stopped short of saying he would vote down the budget and Prime Minister Stephen Harper’s minority government, but warned he would hold the government to account.
The financial sector ran ahead, with Royal Bank and Scotiabank both advancing
Shares in AGF Management Ltd. were off after the investment management firm slid to a fourth-quarter loss of $19.3 million as it took $46.3 million in impairment charges related to weakness in financial markets.
AGF also said the value of its assets under management plunged 33.8% as global stock markets fell in the wake of the financial meltdown.
The energy sector moved up as oil prices stabilized following a steep 9% slide on Tuesday in the wake of dismal U.S. consumer sentiment data. EnCana Corp.and Suncor Inc. headed up
Shares in UTS Energy Corp.jumped 74 cents or 89% to $1.57 after Paris-based energy giant Total made a $617-million all-cash bid to buy the Calgary company. The unsolicited offer is for $1.30 per share, a 57% premium over the closing price of UTS shares on Tuesday.
UTS issued a statement early Wednesday saying it was reviewing the offer and urged shareholders not to take any action. UTS's main asset is its 20-per-cent stake in the Fort Hills Project, located in the Athabasca region of Alberta.
UTS's main asset is its 20% stake in the Fort Hills Project, located in the Athabasca region of Alberta.
Petro-Canada has a 60% stake in the project. Its shares rose. Teck Cominco, which owns 20% of Fort Hills, also advanced.
The gold sector fell. Goldcorp Inc. declined $1.05 to $34.34.
The Canadian dollar surged 0.79 cents to 82.28 cents U.S.
BAYSTREET
Of the 13 TSX sub-groups, 10 were up, hitching their wagon to financials’ star, financials climbing 3.7%, metals and mining issues advancing 2.9% and energy was up 2.0%.
The three sectors in negative territory were led down by gold, off 3.6%, materials, down 1.3%, and consumer staples, off 0.5%
The TSX Venture Exchange gained 2.05 points to 869.92, while the NASDAQ Canada index jumped 22.29 points to 557.46
ON WALLSTREET
The Dow Jones industrials index zoomed 200.72 points to 8,375.45. The Standard & Poor’s 500 index picked up 28.38 points to 874.09. The NASDAQ composite index was 53.44 points better to 1,558.34.
Citigroup Inc. and Bank of America Corp. surged more than 12% after a White House official said Obama’s team may announce the outlines of its plan next week. Deutsche Bank AG and Barclays Plc added at least 18.8% in Europe. Yahoo and SAP, the largest maker of business-management software, climbed more 5.2%.
Citigroup added 59 cents, or 17%, to $4.14, while Bank of America, the largest U.S. lender by assets, jumped 84 cents to $7.34. JPMorgan Chase & Co. climbed 8.7% to $27.25.
The U.S. House of Representatives was set to approve Obama’s proposed $816 billion economic stimulus package Wednesday. The plan is aimed at pulling the economy out of recession through a combination of tax cuts and $604 billion in spending.
The Federal Reserve left its benchmark interest rate as low as zero and said it may keep borrowing costs at “exceptionally low levels” for some time.
Wells Fargo & Co., the second-biggest U.S. home lender, jumped 26% to $20.47. The bank maintained its dividend and said it doesn’t need more federal aid as it reported its first quarterly loss since 2001 following its acquisition of Wachovia Corp.
Yahoo, owner of the second-most-popular U.S. search engine, added 7.8% to $12.22. Excluding items such as stock-based compensation, earnings were about 18 cents a share, buoyed by job cuts and rising domestic sales. That beat the 17 cents estimated by analysts in a Bloomberg survey.
Treasury prices slumped, raising the yield on the benchmark 10-year note to 2.62% from 2.52% Tuesday. Treasury prices and yields move in opposite directions. Yields on the 2-year, 10-year and 30-year Treasurys all hit record lows last month.
U.S. light crude oil for March delivery rose 58 cents to $42.16 U.S. a barrel on the New York Mercantile Exchange.
COMEX gold for April delivery fell $11.40 to $890 U.S. an ounce.
