Canadian stocks ended up for a third session at five-week high Tuesday, on optimism ahead of the Federal Reserve Open Committee meeting with the surging Spanish and Italian bond yields lifting hopes of further monetary stimulus by the central bank. Toronto stocks upsurge was led by financial and resource stocks, as market sentiments improved with the positive developments in Greece.
Toronto's main index, the S&P/TSX, closed Tuesday at 11,788.36, up 187.23 points or 1.61 percent. The S&P/TSX Composite Index touched an intraday high of 11,801.94 and a low of 11,623.69.
The TSX Venture Index closed at 1,264.38, up 4.63 points or 0.37 percent. The index opened at 1,263.44 compared to its previous close of 1,259.75.
Almost all major components of the S&P/TSX Index were in positive territory with the exception of the Global Gold Index that shed 0.69 percent. Among the leaders were the Metals & Mining Index, the Financials Index, and the Energy Index.
The Financial Index jumped 2.27 percent with Royal Bank of Canada moving up 3.89 percent, Bank of Nova Scotia (BNS.TO) gathering 2.77 percent, and Toronto-Dominion Bank (TD.TO) up 1.83 percent. Manulife Financial Corp. (MFC.TO) gained 2.18 percent.
U.S. crude oil futures for July delivery $1.10 or 0.1 percent to close at $1,627.00gained $0.76 or 0.9 percent to close at $84.03 a barrel Tuesday on the NYMEX.
The Energy Index gained a significant 1.99 percent with Suncor Energy Inc. (SU.TO) advancing 3.11 percent, Canadian Natural Resources Limited (CNQ.TO) was up 1.87 percent, and Talisman Energy Inc. (TLM.TO) up 0.69 percent. Ithaca Energy Inc. (IAE.TO) surged 7.60 percent and Cenovus Energy Inc. (CVE.TO) moved up 4.37 percent.
The Metals & Mining Index soared 2.96 percent led by Lundin Mining Corp. (LUN.TO) up 1.15 percent, First Quantum Minerals Limited (FM.TO) up 1.76 percent, and Teck Resources Limited (TCK_B.TO) gathering 1.59 percent. Osisko Mining Corp. (OSK.TO) shed 0.73 percent, while EMED Mining Public Limited (EMD.TO) soared over 29 percent.
Gold futures for August delivery dropped $3.80 or 0.2 percent to close at $1,623.20 an ounce Tuesday on the NYMEX.
Among gold stocks, Eldorado Gold Corp. (ELD.TO) shed 2.07 percent, while Kinross Gold Corp. (K.TO) dropped 0.53 percent. Barrick Gold Corp. (ABX.TO) shed 0.39 percent, while Goldcorp. (G.TO) surrendered 1.23 percent.
The Materials Index moved up 0.79 percent with Potash Corporation of Saskatchewan Inc. (POT.TO) surging 4.71 percent.
Transportation systems maker Bombardier Inc. (BBD.A.TO), was flat with yesterday's close. Smartphone maker Research In Motion Limited (RIM.TO) gained 0.83 percent.
Fuel cell products maker Ballard Power Systems (BLD.TO) revised down its 2012 guidance, assuming there are no bus module shipments to Brazil until 2013. Revenues are now expected at $85 million, down from the earlier $100 million. Nonetheless, the stock gained 1.79 percent.
Commercial real estate company Brookfield Office Properties Inc. (BPO.TO) gained 1.12 percent after indicating it would buy a portfolio of premier office buildings and a development site in the London financial district from Hammerson Plc (HMSO.L) for $829 million.
Cable maker Belden Inc. (BDC) announced that through its wholly-owned subsidiary, it has commenced its offer to acquire all of the outstanding common shares of Miranda Technologies Inc. (MT.TO) for C$17.00 per share in cash. Shares of Miranda edged up 0.12 percent.
In economic news, Statistics Canada said wholesale sales rose 1.5 percent in April to $49.3 billion, largely helped by higher sales in the agricultural supplies industry. Excluding this industry, wholesale sales were unchanged.
In economic news from the U.S., the Commerce Department put the number of privately owned housing starts at a seasonally adjusted annual rate of 708,000 for May, 4.8 percent below the revised April estimate of 744,000. The revised figures put the April housing starts at the highest since October 2008. Nevertheless, most economists expected at least a small continuation of the growth in May, with annual rate of housing starts forecast at 720,000.
From Europe, annual inflation in U.K. slowed unexpectedly in May to the lowest since November 2009, the Office for National Office said. Annual inflation eased to 2.8 percent, largely due to the slower increases in food and non-alcoholic beverage prices. Economists expected the rate to remain unchanged at 3 percent in May. Nonetheless, inflation continues to hover above the 2 percent target.
The Spanish treasury raised 3.04 billion euros from sale of its 12- and 18-month bills, slightly higher than the 3 billion euros maximum sale target. Nonetheless, Spain's 10-year benchmark yield remained above 7 percent on Tuesday, a level considered as unsustainable, having touched an euro-era record of 7.14 percent yesterday.
Meanwhile, survey results published by the Center For European Economic Research (ZEW) showed that German economic expectations declined more than expected in June. The ZEW Indicator of Economic Sentiment for Germany decreased by 27.7 points to a level of minus 16.9 points in June. This is the indicator's strongest decline since October 1998. Economists had forecast a decline to 2.3.
by RTT Staff Writer
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