The latest sign that Canada’s economy is doing better than expected helped push the Toronto stock market higher Monday as it began one of the quietest trading weeks of the year.
The S&P/TSX composite index rose 25.72 points to 13,425.32, while the loonie jumped 0.56 of a cent at 94.47 cents (U.S.).
Statistics Canada reported that the economy grew by 0.3 per cent in October, higher than consensus estimates of 0.2 per cent and on par with September’s increase. It also marked the fourth consecutive month of growth for the country’s gross domestic product.
The figures were a welcome sign on what is expected be a quiet week for the TSX as it heads into the year’s penultimate week of trading. The Toronto exchange is scheduled to close early Christmas Eve, and will be shut down on both Christmas Day and Boxing Day. New York is shuttered just for Dec. 25.
U.S. indexes were positive as the Dow Jones industrials surged 70.14 points to 16,291.28, the Nasdaq jumped 33.18 points to 4,137.92 and the S&P 500 index gained 8.87 points to 1,827.19.
Fred Ketchen, ScotiaMcLeod’s director of equity trading, said the lift in North American markets indicate that investors are finding comfort in the economic news.
“The economic standpoint is not upsetting. It’s not roariously healthy, but there is a certain calmness to it,” said Ketchen.
“I just think there’s a fair amount of comfort of where we are economically, where we are politically and where we are when it comes to the markets. I don’t expect any disasters.”
The latest figures from south of the border also pointed to a rosy outlook. The U.S. Commerce Department reported that Americans increased their spending in November by the most in five months, and their income edged up modestly.
It says consumer spending rose 0.5 per cent from October, when spending had risen 0.4 per cent. It was the best showing since June. The gain was driven by a jump in spending on long-lasting durable goods such as autos.
Markets were also still digesting positive news from Friday that showed the U.S. economy grew 4.1 per cent in the third quarter compared to a year earlier, beating a previous estimate of 3.6 per cent. The report reinforced the view that the United States will lead the world’s other developed economies in growth next year.
In corporate news, Pacific Rubiales Energy Corp. says it is selling its five per cent stake and transportation rights in a Colombian oil pipeline to a consortium led by a private equity unit of Franklin Templeton for U$385-million (U.S.) in cash.
Pacific Rubiales acquired its stake in the OCENSA pipeline when it bought Petrominerales Ltd., in a $1.6-billion deal that was announced in September and closed on Nov. 28.
Proceeds from the sale will be applied to the Petrominerales transaction and reduce the cost for Pacific Rubiales to about C$1.2-billion. Its shares fell a penny, or 0.05 per cent, to $18.75 on the TSX.
French railway operator SNCF has exercised an option to buy an additional 30 Regio 2N double-deck electric passenger trains from Bombardier Inc.
The order is valued at $379-million (U.S.) and brings the total number of units that SNCF has ordered to 159, Bombardier announced Monday from Berlin, where its rail division has its global headquarters.
Commodities were all lower as the February crude fell 23 cents to $99.03 (U.S.) a barrel. The TSX energy sector was the second-highest leading advancer, climbing by 0.32 per cent. The info tech sector was the leading advancer, up by one per cent, as shares in BlackBerry jumped 5.82 per cent or 42 cents to $7.64.
Gold prices lost $4.20 to $1,199.50 (U.S.) an ounce, and was the leading decliner on the TSX, falling by 1.05 per cent. March copper was unchanged at $3.31 a pound.
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