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Federal Reserve Board Chairman Ben Bernanke testifies on Capitol Hill in Washington, Thursday, June 7, 2012, before the Joint Economic Committee about the health of nation's economy, the slumping recovery, and the European debt crisis. (THE ASSOCIATED PRESS)
Federal Reserve Board Chairman Ben Bernanke testifies on Capitol Hill in Washington, Thursday, June 7, 2012, before the Joint Economic Committee about the health of nation's economy, the slumping recovery, and the European debt crisis. (THE ASSOCIATED PRESS)

At the open: Stocks up as U.S. Federal Reserve meets Add to ...

The Toronto stock market gained traction shortly after the open Tuesday as traders focus on a two-day Federal Reserve Board meeting that could lead to an attempt to boost economic confidence.

The S&P/TSX composite index rose 50.17 points to 11,651.30. The TSX Venture Exchange was up 7.08 points at 1266.83.

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The Canadian dollar was up 0.35 of a cent at 98 cents U.S.

The TSX gold stocks led the declines, dropping 1.2 per cent, with Barrick Gold off 44 cents at $40.74.

The metals and mining sector was up 1.5 per cent with Ivanhoe Mines gaining 47 cents to $10.75.

In corporate developments, fuel cell company Ballard Power Systems cut its 2012 sales guidance and said Monday it now expects an adjusted operating loss due to delays in signing a deal in Brazil. Revenue is expected to total about $85-million for the year, down from an earlier estimate of $100-million. Ballard shares were up eight cents at $1.20.

Statistics Canada reported that wholesale sales rose 1.5 per cent in April to $49.3 billion, mainly due to a 48.5 per cent increase in sales of agricultural supplies. Excluding that industry, overall sales were unchanged from March.

In the U.S., some observers expect the Fed will make a move to extend its Operation Twist, under which it sold $400-billion in short-term securities and replaced them with long-term securities in an effort to put more downward pressure on long-term rates.

For now, that appears to be enough to keep traders bullish, despite some mixed U.S. economic data.

The U.S. Commerce Department said overall housing starts fell 4.8 per cent in May, to a seasonally adjusted annual rate of 708,000. However, the report showed that U.S. builders started work on more single-family homes, which suggested a slow recovery in the housing market.

On Wall Street, the Dow Jones industrial average increased 44.27 points to 12,786.09. The Nasdaq composite index rose 19.33 points to 2,914.66 and the S&P 500 index was up 6.33 points at 1,351.11.

In commodities, the July crude contract on the New York Mercantile Exchange rose 70 cents to $83.97 (U.S.) a barrel.

July copper was up one cent at US$3.40 a pound, while August gold shift down $2.20 to $1,624.80 an ounce.

FedEx says higher costs and slow global growth will crimp its earnings results over the next 12 months. The company also posted lower fourth-quarter earnings of $550-million or $1.73 per share in the last quarter, compared with $558-million, or $1.75 per share, a year earlier. Revenue rose to $11-billion from $10.55-billion.

World stock markets were largely flat as relief from Greece’s election results evaporated amid worries that the financial crisis in the 17 countries that use the euro was far from over.

European stocks posted limited gains. Britain’s FTSE 100 rose 1.3 per cent and Germany’s DAX added 0.92 per cent. France’s CAC-40 fell 0.56 per cent.

Asian stocks were sluggish. Japan’s Nikkei 225 index fell 0.8 per cent to close at 8,655.87. Hong Kong’s Hang Seng fell slightly to 19,416.67 and Australia’s S&P/ASX 500 lost 0.3 per cent to 4,123.30.

 
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