Canadian stocks settled sharply higher Friday, as investor risk appetite improved after the U.S. Federal Reserve announced a third round of quantitative easing yesterday, which includes a $40-billion bond buying program every month, starting today. The surge was led mostly by resource stocks, buoyed by higher commodity prices.
The S&P/TSX Composite Index closed Friday at 12,499.47, up 139.31 points or 1.13 percent. The index touched an intraday high of 12,529.77 and a low of 12,360.16.
For the week, the S&P/TSX Composite Index gained 1.9 percent.
The Global Gold Index surged 2.88 percent, with gold futures for December delivery gaining $0.60 or 0.03 percent to close at $1,772.70 an ounce Friday on the NYMEX.
The Capped Materials Index climbed 2.53 percent, with fertilizer maker Potash Corporation of Saskatchewan Inc. (POT.TO) gaining 0.36 percent.
Among gold stocks, Barrick Gold Corp. (ABX.TO) climbed 2.16 percent, Goldcorp Inc. (G.TO) was up 2.07 percent, Yamana Gold Inc. (YRI.TO) improved 2.24 percent, Eldorado Gold Corp. (ELD.TO) rose 4.30 percent, and Kinross Gold (K.TO) moved up 4.18 percent.
The Metals & Mining Index climbed 3.99 percent, with Teck Resources Limited (TCK.B.TO) jumping 5.03 percent and First Quantum Minerals Ltd. (FM.TO) moved up 1.45 percent. Lundin Mining Corp. (LUN.TO) gained 5.72 percent, while Osisko Mining Corp. (OSK.TO) gathered 1.36 percent.
The Energy Index gained 1.96 percent, with U.S. crude oil futures for October delivery moving up $0.69 or 0.7 percent to close at $99.00 a barrel Friday on the NYMEX.
Among energy stocks, Suncor Energy Inc. (SU.TO) jumped 3.44 percent, Talisman Energy Inc. (TLM.TO) was up 4.22 percent, Canadian Natural Resources Limited (CNQ.TO) gained 2.59 percent, and Encana Corp. (ECA.TO) edged up 0.35 percent.
The Financial Index moved up 0.97 percent, led mostly by Manulife Financial Corp. (MFC.TO) surging 4.12 percent. Royal Bank of Canada (RY.TO) gained 0.57 percent, Bank of Nova Scotia (BNS.TO) edged up 0.26 percent, and Toronto-Dominion Bank (TD.TO) was up 0.42 percent.
Transportation systems maker Bombardier Inc. (BBD.A.TO, BBD.B.TO) shed 0.26 percent.
The Information Technology Index gained 0.47 percent, with smartphone maker Research In Motion Limited (RIM.TO) gaining 2.09 percent.
Communications equipment manufacturing company Evertz Technologies Ltd. (ET.TO) gained 2.14 percent after reporting improved first quarter profit of C$24.8 million or C$0.34 per share, compared to C$17.6 million or C$0.23 per share in the same period last year. Analysts expected earnings of C$0.25 per share for the quarter.
Meanwhile, Golden Minerals Company (AUM.TO) dived nearly 16 percent after announcing an underwriting agreement with Wells Fargo Securities to sell 5,497,504 units at a price of $5.75 per unit.
Contact lenses retailer Coastal Contacts Inc. (COA.TO) reported a wider third quarter net loss at C$1.9 million or C$0.07 per share, compared to C$1.5 million or C$0.06 per share in the year-earlier quarter. Analysts expected breakeven earnings for the quarter. The stock shed nearly 7.68 percent.
In economic news, Statistics Canada said manufacturing sales fell 1.5 percent to $48.3 billion in July mainly due to declines in transportation equipment. Manufacturers in 11 of 21 industries reported lower sales, representing over 60 percent of total manufacturing. Moreover, inventories rose 1.0 percent in July to $65.5 billion, led by increases in the aerospace product and parts, and machinery industries
In economic news from the U.S, the Labor Department said its consumer price index rose by 0.6 percent in August after coming in flat in three of the four previous months. The increase in prices matched the expectations of economists. Core consumer prices, which exclude food and energy prices, edged up by a more modest 0.1 percent in August, matching the increase seen in July. Economists had expected core prices to rise by 0.2 percent.
Meanwhile, a report from the U.S. Commerce Department put the advance estimate of retail sales for August at a seasonally adjusted level of $406.7 billion, a 0.9 percent increase from revised July levels and the strongest monthly growth since February. Excluding the automotive sector, retail sales for August remained up a strong 0.8 percent, matching the expectations of most economists.
Elsewhere, eurozone inflation increased as initially estimated to 2.6 percent in August, final data issued by Eurostat showed Friday. The rate rose from 2.4 percent in July. The central bank aims to retain inflation rates below, but close to, 2 percent over the medium term. Month-on-month, consumer prices were up 0.4 percent, in line with economists' expectations.
A separate report from the Eurostat revealed that the number of persons employed remained stable in the euro area during the second quarter, after falling 0.3 percent sequentially in the prior quarter.
by RTT Staff Writer
For comments and feedback: editorial@rttnews.com
Market Analysis