The Toronto stock market was positive on hopes for a ceasefire in eastern Ukraine, while traders awaited the latest data on vehicle sales and U.S. factory orders.
The S&P/TSX composite index advanced 54.62 points to 15,673.7.
The Canadian dollar rose 0.18 of a cent to 91.67 cents (U.S.) ahead of the mid-morning announcement on interest rates by the Bank of Canada. The central bank is universally expected to hold the line on rates at one per cent, where the key rate has rested since September 2010.
U.S. indexes also advanced with the Dow Jones industrials up 68.52 points to 17,136.08, the Nasdaq slipped 6.53 points to 4,591.66 and the S&P 500 index rose 5.81 points to 2,008.09.
There was relief on the markets after the office of Ukrainian President Petro Poroshenko said Wednesday that he and Russian President Vladimir Putin are in agreement on a ceasefire in eastern Ukraine, the scene of heavy fighting between Ukraine forces and pro-Russian militias.
The brief statement said “mutual understanding was reached regarding the steps that will contribute to the establishment of peace” but gave no details.
However, there have been previous statements of agreements on steps for peace, but the conflict has only intensified.
“The announcement suggests that tensions in the region could start easing and another round of sanctions against Russia won’t be forthcoming (assuming the steps to the cease-fire are followed),” said BMO Capital Markets senior economist Benjamin Reitzes.
Meanwhile, the financial costs of the tensions between Ukraine and Russia were highlighted in the latest business activity gauge for the eurozone from financial information company Markit.
Its purchasing managers’ index fell to 52.5 points in August from July’s three-month high of 53.8. Though it remains above the 50 threshold that signals growth, the indicator is at its lowest level this year and below the preliminary estimate of 52.8.
It is a heavy week for economic data in North America with traders particularly focused on the release Friday of the U.S. government’s employment report for August. Economists forecast that the American economy created about 220,000 jobs during the month. Investors hope the data will provide further clues about when the U.S. Federal Reserve may start to hike interest rates, likely in mid-2015.
Traders will also consider the Fed’s latest snapshot of the economy when the central bank releases its regional survey mid-afternoon.
Canadian jobs data will also be released Friday.
Most TSX sectors were positive, paced by a 0.63 per cent rise in the metals and mining sector as December copper declined one cent to $3.14 (U.S.) a pound.
The energy sector advanced 0.4 per cent while October crude gained $1.27 to $94.15 a barrel after tumbling $3 on Tuesday.
December bullion rose $2.20 to $1,267.20 an ounce and the gold sector gained 0.45 per cent.
In corporate developments, convenience store and gasoline station operator Alimentation Couche-Tard reported its quarterly net income rose 5.7 per cent to $269.5-million (Canadian) or 47 cents a share. It also announced that it’s increasing its shareholder dividend by half a cent to 4.5 cents per share, and its shares ran ahead $1.22 to $34.45.