The Toronto stock market was up Tuesday, building on the strong gains racked up so far this month amid a stream of earnings reports.
The S&P/TSX composite index gained 65.33 points to 13,437.17 in late morning trade, putting the Toronto market up about seven per cent year to date.
The TSX has risen for the past four weeks amid positive earnings news and growing confidence about steady economic growth in Europe and China.
The Canadian dollar was up 0.04 of a cent at 95.78 cents US.
U.S. indexes were also higher as the U.S. Federal Reserve’s policymakers began a scheduled, two-day interest rate meeting.
Traders are particularly interested in the Fed’s wrap-up announcement and will look for hints as to when the U.S. central bank might start to cut back on its monthly purchase of US$85-billion of bonds.
The Dow Jones industrials gained 57.28 points to 15,626.21, the Nasdaq was up 4.06 points to 3,944.19 and the S&P 500 index rose 5.23 points to 1,767.34.
Markets had previously expected the Fed to begin withdrawing stimulus this year but after the Fed took a pass on tapering last month, expectations have shifted to next year as the pace of improvement in the U.S. economy faded.
“In hindsight, it was the right move because they had foreseen the political events and saw the runup in bond yields when they talked about tapering, said Ian Nakamoto, director of research at 3MACS Inc.
Also, economists are still trying to gauge the cost of the political wrangling earlier this month that resulted in a partial shutdown of the U.S. government.
Traders also took in a soft reading on retail sales for September.
Overall, retail sales dipped 0.1 per cent in the weakest showing since March. But excluding autos, sales rose 0.5 per cent in September, up from 0.2 per cent in August.
On the earnings front, Apple shares were down a slight $3.71 to US$526.17 after reporting after the close Monday that quarterly earnings came in at US$7.5-billion, or $8.26 per share, during the quarter, down from $8.2-billion, or $8.67 per share, last year. That beat expectations of $7.92 per share while revenue rose four per cent to $37.5-billion, again topping expectations.
But Apple’s earnings have now fallen from the previous year in three consecutive quarters after a decade of steady growth.
Nokia reported a third-quarter net loss of €91-million as revenue plunged more than 20 per cent to €5.6-billion.
But the company gave a positive outlook on its continuing operations, including networks, and its stock ran ahead 56 cents or 8.3 per cent to $7.31.
The consumer discretionary segment led the TSX, up 0.9 per cent as information giant Thomson Reuters Inc. (TSX:TRI) says it will record US$350-million of accounting items related to a restructuring of its Financial & Risk business unit. The restructuring charge was announced along with the Thomson’s third-quarter results, which showed revenue from the Finance & Risk unit was down compared with a year ago while other units showed increases. Thomson’s adjusted earnings for the three months ended Sept. 30 was 48 cents per share and its shares advanced 84 cents to $38.16.
Financials also continue to build on the strong gains of this month, up 0.8 per cent late Tuesday morning. The sector is up four per cent for this month alone, helped along by fewer worries about the health of the Canadian real estate market.
“This housing market that people thought was going to collapse, it doesn’t look like it’s going to happen anytime soon,” added Nakamoto.
“There’s no doubt the financials have done the heavy lifting here.”
TD Bank (TSX:TD) climbed $1.19 to $95.38.
Commodities were mixed with the December crude contract on the New York Mercantile Exchange down 37 cents to US$98.31 a barrel. The energy sector gained 0.55 per cent while Canadian Natural Resources (TSX:CNQ) improved by 39 cents to C$33.08.
The gold sector led declines, down 1.15 per cent while December bullion shed $3.40 to US$1,348.80 an ounce. Goldcorp (TSX:G) faded 44 cents to C$27.87.
The base metals segment was down 0.4 er cent while December copper rose two cents to US$3.29 a pound. First Quantum Minerals (TSX:FM) shed 41 cents to C$18.95.
Investors also digested a major real estate deal involving Sears Canada (TSX:SCC).
The retailer will get $400-million from its landlords for vacating five department stores by the end of February, including its flagship location in Toronto’s Eaton Centre. Sears shares gained 72 cents or 5.32 per cent to $14.26.
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