The Toronto stock market advanced as a positive forecast on the global economy helped boost oil and metal prices.
The S&P/TSX composite index gained 72.57 points to 13,764.95, while the Canadian dollar drifted 0.06 of a cent higher to 91.4 cents (U.S.).
The World Bank’s twice-yearly Global Economics Prospects report said global growth is expected to rise from 2.4 per cent in 2013 to 3.2 per cent this year and 3.4 per cent in 2015.
“This should be the first year of synchronous global growth we’ve seen since the credit crisis,” said Bob Gorman, chief portfolio strategist at TD Waterhouse.
“Europe isn’t going to be great but our view is we have had a couple of quarters in which they have inched out of negative territory on the economic side”
Meanwhile, U.S. indexes were higher after a strong earnings report from Bank of America and a much better than expected reading on manufacturing in the U.S. Northeast.
The Empire manufacturing survey beat expectations, rising to 12.5 in January, from a revised 2.2 in December. The survey showed significant improvements in balances for new orders, shipments and employee numbers.
The Dow Jones industrials jumped 126.49 points to 16,500.35, the Nasdaq was ahead 27.93 points to 4,210.95 and the S&P 500 index was up 11.38 points to 1,850.26.
Bank of America, the second-largest U.S. bank, earned $3.44-billion (U.S.) or 29 cents a share in the October-to-December period, up from $732-million a year earlier. The showing beat forecasts by two cents amid a big improvement in loan loss provisions. It shares were up 46 cents to $17.23 (U.S.).
Traders also awaited the afternoon release of the latest take on the economy by the U.S. Federal Reserve. The Fed has started to reduce its bond purchasing program to $75-billion a month, down from $85-billion, but has said further tapering will depend on economic performance, particularly jobs data.
Uncertainty about Fed intentions arose after December jobs data released last Friday came far below expectations.
Corporate earnings were the other big issue for markets as fourth quarter data starts to come in. The S&P 500 rocketed about 30 per cent last year, helped in large measure by Fed stimulus. Investors now want to see if strong earnings and revenue can justify that gain and push stock prices higher.
The base metals component was the leading TSX advancer, up 1.5 per cent while the March copper contract added two cents to $3.35 (U.S.) a pound. Teck Resources was 70 cents higher to $26.99 (Canadian) while Thompson Creek Metals continued to benefit from an upgrade by Bank of America/Merrill Lynch, up 23 cents or eight per cent to $3.05 after jumping 18 per cent Monday.
The gold sector moved into positive territory, up 0.9 per cent as the February gold bullion contract lost $4.90 to $1,240.50 (U.S.) an ounce while the TSX gold sector declined 0.2 per cent. Barrick Gold climbed 23 cents to $19.72 (Canadian).
Osisko Mining Corp. says a hostile takeover bid for the company by Goldcorp Inc. is “very low” and urged shareholders to hold off from accepting the $2.6-billion offer until the board makes a recommendation on the proposal.
Osisko shares have traded well above the $5.95 implied value of the Goldcorp offer since the stock-and-cash proposal was first announced Monday. On Wednesday, Osisko shares slipped four cents to $6.19 (Canadian) while Goldcorp faded three cents to $24.31.
The tech sector gained 0.85 per cent with Open Text ahead $2.24 to $99.28 while Constellation Software climbed $3.01 to $226.26.
The consumer discretionary group was up 0.5 per cent and shares in Magna International Inc. were up $1.09 to $93.23 as the auto parts maker forecast between $33.8-billion (U.S.) and $35.5-billion of total sales this year, with about half of that generated from North America.
Financials climbed 0.55 per cent with Power Corp. of Canada ahead 58 cents to $31.35 and Manulife Financial gained 23 cents to $21.81.
The February crude oil contract on the New York Mercantile Exchange gained $1.60 to $94.19 (U.S.) a barrel amid data showing a much bigger than expected 7.7-million barrel drop in supplies and the energy sector was up 0.35 per cent.
European bourses advanced as London’s FTSE 100 gained 0.7 per cent, Frankfurt’s DAX climbed 1.9 per cent and the Paris CAC 40 rose 1.35 per cent.
- Bank of America Corp$17.44-0.03(-0.17%)
- Goldcorp Inc$15.63-0.14(-0.89%)
- S&P/TSX Composite$13.40K-4.41(-0.03%)
- S&P 500 INDEX$2.09K-0.27(-0.01%)
- Dow Jones Industrials$17.81K+1.20(+0.01%)
- NASDAQ NMS COMPOSITE INDEX$5.12K+13.34(+0.26%)
- Gold Front Month Futures$1.07K-2.30(-0.21%)
- Updated November 25 1:42 PM CDT. Delayed by at least 15 minutes.