The Toronto stock market was higher Monday, building on last week’s strong gains while crude oil moved below US$100 for the first time since early July.
The S&P/TSX composite index rose 36.67 points to 13,172.76, led by gains in the mining sector.
The market also found support from big gains in the consumer sector.
Maple Leaf Foods (TSX:MFI) is planning to sell its bakery business, which includes a 90 per cent interest in Canada Bread (TSX:CBY), maker of Dempster’s and other brands. Based on recent stock market values, Canada Bread had a value of about $1.6-billion prior to the announcement Monday. Maple Leaf shares jumped $1.26 or 9.47 per cent to $14.56 while Canada Break shares surged $6.09 or 9.94 per cent to $67.34.
The Canadian dollar was down 0.04 of a cent to 97.1 cents US two days before the Bank of Canada’s latest interest rate announcement. Many economists expect the bank will keep its key rate at one per cent until around the fourth quarter of 2014.
U.S. indexes were slightly lower as investors look to a heavy week of earnings data and economic reports that were held up because of the partial U.S. government shutdown that dragged on this month until late last week.
The Dow Jones industrials declined 18.75 points to 15,380.9, the Nasdaq gained 8.71 points to 3,922.99 and the S&P 500 index slipped 0.04 of a point to 1,744.46.
The major economic report of the week is the U.S. government’s employment report for September. That’s due on Tuesday and could provide investors an indication as to when the Fed will start reducing its US$85-billion-worth of monthly asset purchases.
Until the U.S. debt crisis this month, most investors thought the Fed’s so-called “tapering” of its stimulus program would start by December. Many now think it won’t start until Janet Yellen takes the chair in early 2014.
On the earnings front, McDonald’s earned $1.52-billion, or $1.52 per share, in the latest quarter. That compares with $1.46-billion, or $1.43 per share, last year. Analysts expected $1.51 per share.
Revenue rose two per cent to $7.32-billion, missing expectations of $7.33-billion and its shares were down $1.68 to US$93.52.
Oilfield operator Halliburton Co. posted third-quarter net income of $706-million, or 79 cents per share, up 17 per cent from a year ago as revenue rose overseas. Ex-items, income from continuing operations was 83 cents per share, a penny better than expected. However, revenue of $7.47-billion missed estimates of $7.5-billion and its shares fell $1.86 to $50.61.
Toymaker Hasbro Inc. said third-quarter net income rose 17 per cent from a year ago to $193-million, or $1.46 per share. The quarterly results come as toy makers gear up for the holiday season, which can account for up to half their annual revenue.
Ex-items, Hasbro’s earnings were $1.31 per share, a penny above estimates. Revenue climbed two per cent to $1.37-billion, against estimates of $1.35-billion and its shares jumped $3.39 to $50.63.
Traders will also consider earnings from Netflix during the day.
The gold sector led TSX advancers, up 1.4 per cent while December bullion rose $1.30 to US$1,315.90 an ounce. Barrick Gold Corp. (TSX:ABX) rose 28 cents to C$19.35.
The base metals sector rose almost one per cent as December copper added a penny to US$3.30 a pound. HudBay Minerals (TSX:HBM) was ahead 10 cents to C$8.38.
The November crude contract on the New York Mercantile Exchange fell 72 cents to US$100.09 a barrel after earlier going as low as $99.45 amid rising supplies of crude and lower demand. The energy sector rose 0.17 per cent and Imperial Oil (TSX:IMO) climbed 47 cents to $46.72.
Techs led decliners while BlackBerry (TSX:BB) shed 11 cents to $8.53.
The TSX jumped 1.9 per cent last week to its highest levels since late July, 2011 after U.S. lawmakers finally agreed on a deal to end the government shutdown and raise the U.S. debt ceiling.
But there are several reasons for the performance on the TSX, including much improved economic conditions in Europe and China which have benefitted the resource sectors while financials have ran ahead as the Canadian housing market hasn’t shown signs of a dramatic correction.
Last week’s advance left the TSX up 5.65 per cent year to date, still lagging the Dow industrials by a wide margin. The blue chip index has surged 17.5 per cent so far in 2013.
European bourses were mixed with London’s FTSE 100 index ahead 0.07 per cent, Frankfurt’s DAX declined 0.15 per cent while the Paris CAC 40 lost 0.4 per cent.
Earlier, Japan’s Nikkei 225 index rose 0.9 per cent while China’s benchmark Shanghai Composite Index added 1.6 per cent. Hong Kong, Seoul and Sydney also rose.
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