The Toronto stock market climbed Wednesday after opening lower, with traders risk averse amid worries about growing Russian troop strength on its border with Ukraine and data showing Italy unexpectedly has fallen back into recession.
The S&P/TSX composite index climbed 14.52 points to 15,202.23, supported by the gold sector as nervous investors sent bullion prices higher.
Despite the risk-off sentiment, the Canadian dollar was up 0.1 of a cent to 91.34 cents (U.S.) as Statistics Canada reported that the country’s trade surplus shot up to $1.9-billion in June from a revised $576-million in May. Economists had generally expected a $100-million deficit.
The improvement came as exports rose 1.1 per cent to a record high of $45-billion in June, while imports declined 1.8 per cent.
New York indexes were also higher as the Dow Jones industrials climbed 14.96 points to 16,444.43, the Nasdaq gained 1.42 points to 4,354.26 and the S&P 500 index was up 1.02 points to 1,921.23.
Geopolitical worries were front and centre again Wednesday after news reports of a buildup of Russian troops on the Ukraine border. Stock markets had closed lower Tuesday after Poland’s prime minister said he has information indicating that there is a growing threat of a “direct intervention” by Russia in Ukraine.
In addition, Russian president Vladimir Putin has told his government to prepare retaliatory measures against sanctions that have been levied by the U.S. and the EU for his country’s support of Ukrainian rebels.
Meanwhile, data showed that Italy’s gross domestic product contracted 0.2 per cent in the second quarter, which added to a negative showing in the first quarter, meaning the country is in technical recession.
The financials sector led decliners down 0.5 per cent ahead of earnings reports today from insurers Sun Life Financial and Great West Lifeco.
The base metals sector was down 0.55 per cent while September copper dropped three cents to $3.17 (U.S.) a pound.
The energy sector lost 0.35 per cent while September crude was ahead 37 cents to $97.75 a barrel.
The gold sector was up two per cent with December bullion ahead $21.90 to $1,307.20 an ounce.
On the earnings front, Tim Hortons reported that quarterly profits were flat at $123.8-million (Canadian) or 92 cents a share versus $123.7-million or 81 cents a year earlier, benefiting from a share repurchase program announced last summer. Same-store sales grow 2.6 per cent in Canada and 5.6 per cent in the United States. The restaurant chain also anticipates earnings per share to be near the higher end – or slightly above – its current target range of $3.17 to $3.27 earnings per share for the year and its shares ran ahead 5.3 per cent to $63.25.
Athabasca Oil Corp. lost $56.8-million, or 14 cents per share, in the second quarter after the Calgary-based company set aside $49-million for a potential settlement of some claims made by Phoenix Energy Holdings Ltd., a company owned by PetroChina Co. Ltd. A year earlier losses were $30-million or seven cents per share. It shares added six cents to $6.18.