The Toronto stock market racked up a small gain late morning Monday but that advance was largely due to a pop in gold miners as traders looked for direction following a volatile week of trading.
The S&P/TSX composite index gained 13.3 points to 13,799.8 as traders also took in acquisition activity over the weekend while the Canadian dollar edged 0.06 of a cent lower to 90.53 cents (U.S.).
U.S. indexes were mainly tepid as the Dow Jones industrials declined 39.82 points to 15,754.26, the Nasdaq was up 2.77 points to 4,128.63 while the S&P 500 index dipped 3.67 points to 1,793.35.
The TSX and the Dow both advanced about 0.6 per cent last week even as the U.S. unemployment rate dipped to 6.6 per cent from 6.7 per cent, the lowest rate since the global financial crisis hit in late 2008 while labour force participation increased.
But on the way to that gain, markets were volatile amid discouraging manufacturing data from the U.S. and China. There was also nervousness about the problems some emerging markets are having in adapting to a world no longer awash in cheap money courtesy of stimulus from the Federal Reserve.
“We’re lacking a bit of direction,” said Craig Fehr, Canadian markets specialist at Edward Jones in St. Louis.
“The data will, in fits and starts, provide some of that direction but we had the big decline (early) last week, we had a rally and got everything condensed into a couple of trading days and now the market is taking a step back.”
Analysts thought Friday’s jobs data was strong enough to allow the Fed to continue reducing its bond purchases. It has already cut its purchase to $65-billion a month, down $20-billion, and analysts generally expect the Fed to continue to taper at $10-billion a meeting.
Investors are also looking ahead to comments by the new Federal Reserve chair, Janet Yellen, before the U.S. Congress on Tuesday.
The TSX gold sector ran ahead three per cent while April gold rose $12 to $1,274.90 (U.S.) an ounce.
Yamana Gold shares climbed 50 cents or 4.95 per cent to $10.61 as it said that it expects its combined gold and silver output this year will be 16 per cent above 2013’s level, while its cash costs per ounce remain relatively stable.
The base metals sector was the major decliner, down 0.65 per cent with March copper down two cents at $3.22 (U.S.) a pound.
The energy sector lost about 0.5 per cent while March crude on the New York Mercantile Exchange edged 21 cents higher to $99.75 (U.S.) a barrel.
On the corporate front, International Forest Products Ltd. shares jumped 12.35 per cent to $17.08 (Canadian) as the Vancouver-based company moved to acquire a Georgia lumber business in a $180-million (U.S.) deal with Ilim Timber Continental SA.
HudBay Minerals Inc. is out to acquire all the shares of Augusta Resources Corp. that it doesn’t already own in a cash and stock deal worth about $540-million. August’s prime asset is its Rosemont copper deposit in Arizona. HudBay is offering $2.96 a share. HudBay fell 65 cents to $8.75 (Canadian) while Augusta shares rocketed 25.5 per cent to $3.15.