The Toronto stock market was higher Tuesday as emerging market worries receded and traders looked to a mixed bag of earnings reports.
The S&P/TSX composite index was ahead 44 points to 13,626.29 as investors also looked to a major deal in the financial sector.
Bank of Montreal is offering to buy U.K.-based investment manager F&C Asset Management PLC in a cash deal valued at $1.3-billion. The bank is offering 120 British pence for each share, which is about 28 per cent above F&C’s closing price last Friday before news of the talks became public. BMO shares dipped 16 cents to $70.30.
The Canadian dollar was slightly lower after closing at a 4 1/2 low on Monday, down 0.46 of a cent to 89.53 cents (U.S.).
U.S. indexes were mixed amid a surprisingly weak durable goods orders report.
Orders for durable goods fell 4.3 per cent in December compared with November, when orders had risen 2.6 per cent. The weakness was led by a big 17.5 per cent drop in the volatile category of commercial aircraft.
The Dow Jones industrials were up 77.13 points to 15,915.01 amid strong results from automaker Ford. The Nasdaq composite index shook off early losses to move up 2.65 points to 4,086.26 amid investor disappointment with earnings from Apple. The S&P 500 index rose 7.26 points to 1,788.82.
Markets have been severely buffeted over the last few sessions on concerns about emerging markets, including slowing growth in China, the world’s second biggest economy.
Investors have also been jittery because of currency turmoil involving countries such as the Turkish lira, the Russian ruble and the Indian rupee as investors wonder how the Federal Reserve’s policy to reduce its monetary stimulus impacts on them.
The Fed’s massive bond purchases over the last few years has resulted in a stream of cheap money into those markets. But now the central bank is cutting back on those asset purchases.
The Fed makes its next interest rate announcement Wednesday and markets widely expect it to further pare its bond purchases by another $10-billion a month to $65-billion (U.S.).
At the same time, analysts have suggested that North American stock markets were vulnerable to a correction after Fed monetary easing helped underpin a strong rally on many equity markets last year that left the S&P 500 alone up about 30 per cent for 2013.
TSX gains were paced by a one per cent rise in the base metals sector while March copper on the Nymex was unchanged at $3.26 (U.S.) a pound. Teck Resources was up 30 cents to $27.18 (Canadian).
First Quantum Minerals says it expects its Cobre Panama project will cost about $6.4-billion (U.S.), up from an earlier estimate of $6.2-billion. But it added the mine will produce about 320,000 tonnes of copper annually over the life of the mine, up about 20 per cent and First Quantum shares gained 24 cents to $20.08.
The tech sector rose almost one per cent with BlackBerry ahead 33 cents to $11.17.
Oil prices started to recover after two days of steep losses with the March crude contract on the New York Mercantile Exchange up 96 cents to $96.68 (U.S.) a barrel. The energy sector rose 0.5 per cent and Suncor Energy advanced 30 cents to $36.62 (Canadian).
February bullion declined $4.80 to $1,258.60 (U.S.) an ounce and the gold sector also climbed 0.5 per cent. Barrick Gold was up 21 cents to $20.82 (Canadian).
In earnings news, automaker Ford earned $3-billion, or 74 cents per share, in the final quarter of 2013, but that was largely because of a one-time tax gain. Excluding the gain, net income was 31 cents per share, topping analysts’ forecast of 27 cents. Fourth-quarter revenue rose 3.5 per cent to $37.6-billion and its shares were up 11 cents to $15.82.
Apple shares were down 7.8 per cent to $507.55 (U.S.) even as the company reported its best quarter, which ended Dec. 28. Besides hitting new quarterly highs for the sales of its most popular products, Apple also delivered earnings that exceeded analyst projections. It also produced the highest quarterly revenue in its 38-year history. But it also delivered a revenue forecast that fell below analysts’ predictions for the current quarter.
European bourses were in positive territory as London’s FTSE 100 index advanced 0.27 per cent, Frankfurt’s DAX rose 0.25 per cent while the Paris CAC 40 was up 0.6 per cent.
- Ford Motor Co$11.590.00(0.00%)
- Bank of Montreal$73.530.00(0.00%)
- S&P/TSX Composite$12.54K0.00(0.00%)
- S&P 500 INDEX$1.85K-26.61(-1.42%)
- Dow Jones Industrials$16.03K-177.92(-1.10%)
- NASDAQ NMS COMPOSITE INDEX$4.28K0.00(0.00%)
- Gold Front Month Futures$1.19K-7.60(-0.63%)
- Updated February 8 4:00 PM EST. Delayed by at least 15 minutes.