Markets in Toronto came out roaring from the opening bell, as investors were cheered about optimistic data from Europe, and as commodity prices improved.
The S&P/TSX Composite Index leaped 168.76 points, or 1.5%, soon after Tuesday’s opening to 11,708.46
The Canadian dollar gained 1.03 cents to 97.35 cents U.S., after data showed Canada’s inflation was in line with expectations in November.
Stocks to watch this morning include TransCanada Corporation. The pipeline operator has expanded its alternative energy business with a deal to buy nine solar power projects in Ontario for $470 million.
German business confidence rose unexpectedly in December, while German consumers were resilient in the face of rising economic risks and the ongoing debt crisis.
Spain’s weekly auction of short-term debt was also encouraging for investors. Borrowing costs for three- and six-month notes fell sharply amid strong demand, indicating market confidence in the country’s ability to handle its debt is recovering.
The reassuring macroeconomic news reinforced improving market sentiment as the leadership succession in North Korea appeared to be under control.
The possibility of a power struggle in a country pursuing nuclear weapons and known for its secrecy and unpredictability have heightened tensions in the region and unsettled markets on Monday.
On the economic scene, Statistics Canada reported the country’s annual inflation rate remained relatively high at 2.9% last month as Canadians continued to pay considerably more for food and gasoline than they had 12 months earlier.
ON BAYSTREET
The TSX Venture Exchange jumped 16.27 points to 1,423.66, while the Nasdaq Canada index gained 8.11 points to 354.70
All 14 Toronto subgroups popped, led by metals and mining, gaining 3.3%, global base metals, moving up 3.2%, and gold, galloping ahead 2.7%.
ON WALLSTREET
In New York, stocks shot higher at the open Tuesday, as investors shrugged off caution over developments in Europe.
The Dow Jones Industrials gained 230.34 points, or 2%, to start the day at 11,996.60
The S&P 500 picked up 24.69 points, to 1,230.04, while the Nasdaq Composite charged up 56.22 points to 2,579.36
Shares of Apple were up 1%, after the U.S. International Trade commission ruled Monday that the software in some of HTC's Android smartphones violated one provision of an Apple patent, and that those phones would no longer be allowed into the U.S.
Google shares were up slightly, after the company said it would acquire a portfolio of solar photovoltaic (PV) facilities with KKR. The deal brings Google's total investment in renewable energy projects to more than $915 million U.S.
Food producer General Mills reported quarterly earnings of 76 cents U.S. per share, slightly missing estimates. Analysts surveyed by Thomson Reuters expected earnings of 79 cents U.S. per share.
Late Monday, AT&T announced it had abandoned its $39-billion U.S. bid for T-Mobile, a deal that would have created by far the nation's largest wireless company.
U.S. stocks closed sharply lower Monday, as bank shares took a beating amid fresh concerns about the debt crisis in Europe.
Bank of America fell below $5 U.S. per share on Monday, its lowest level since the worst of the financial crisis in March 2009. Citigroup, Goldman Sachs, JPMorgan, Morgan Stanley and Wells Fargo also fell sharply.
The selloff was driven by speculation that BofA and other big U.S. banks will need to raise more capital, according to one expert
U.S. banks have been hit by concerns about their exposure to bonds issued by fragile governments in the euro-zone. In addition, traders pointed to reports that tougher regulations on banks could come to pass sooner than expected.
Economically speaking, U.S. housing starts increased by 9.3%, to an annualized pace of 685,000 in November, from 627,000 in October, with building permits rising 1.8% to 681,000 compared to last year.
Market expectations going into the report had been for much fewer housing starts at 635,000
The price on the benchmark 10-year U.S. Treasury sagged, pushing the yield up to 1.87% from 1.81% Monday. Treasury prices and yields move in opposite directions.
Oil for January delivery progressed $2.85 to $96.73 U.S. a barrel.
Gold futures for February delivery fell $8.90 to $1,605.60 U.S. an ounce.
