A 2009 photo showing people walking by a branch of Vodafone in central London. Britain's Vodafone PLC, one of the world's largest mobile phone companies, confirmed Aug. 29, 2013, that it was in discussions with Verizon Communications to sell its operations in the United States.SANG TAN/The Associated Press
The Toronto stock market got off to a strong start to September trading amid improved manufacturing data from China and fading chances of a military strike against Syria.
The S&P/TSX composite index ran ahead 117.5 points to 12,771.4.
Support also came from the telecom sector on Tuesday after U.S. telecom giant Verizon Communications Inc. said it was no longer interested in entering the Canadian wireless market. Verizon had announced Monday that it was paying $130-billion (U.S.) for the 45 per cent stake in Verizon Wireless owned by British cellphone carrier Vodafone.
Rogers Communications rose $3.12 or 7.5 per cent to $44.38, BCE Inc. climbed $1.81 or 4.19 per cent to $45 and Telus Corp. jumped $2.06 or 6.3 per cent to $34.75.
Techs also advanced after Microsoft Corp. announced it was buying Nokia Corp.'s lineup of smartphones and a portfolio of patents and services for $7.2-billion (U.S.). Buyout hopes for BlackBerry sent the smartphone maker's stock up 26 cents to $10.90 (Canadian).
The Canadian dollar was down 0.14 of a cent to 94.83 cents (U.S.) as the U.S. dollar appreciated on a much better than expected reading on American manufacturing.
U.S. indexes were also higher as traders weighed the chances of President Barack Obama getting congressional approval for punishing Syria for a sarin gas attack outside Damascus on Aug. 21 that U.S. intelligence says killed 1,429 people, including more than 400 children.
"We're not out of the woods yet," observed Kash Pashootan, vice-president and portfolio manager at First Avenue Advisory, a Raymond James company, adding that volatility could return when Congress comes back from vacation next week.
"I think volatility could be back."
The Dow Jones industrials ran ahead 90.12 points to 14,900.43 as the latest reading on the U.S. manufacturing sector showed stronger than expected expansion in August. The Institute for Supply Management's index rose to 55.7 from 53 in July, much stronger than the 54 reading that had been expected.
The Nasdaq gained 44.98 points to 3,634.85 and the S&P 500 index was up 15.12 points at 1,648.09.
Microsoft is attempting to strengthen its fight with Apple Inc. and Google Inc. to capture a slice of the lucrative mobile computing market through the Nokia purchase.
The proposed price consists of €3.79-billion for the Nokia unit that makes mobile phones, including its line of Lumia smartphones that run Windows Phone software. Another €1.65-billion will be paid for a 10-year licence to use Nokia's patents, with the option to extend it indefinitely.
The deal came down a day after Verizon announced its deal with Vodafone. Verizon CEO Lowell McAdam also suggested in an interview with Bloomberg that speculation Verizon might try to compete in Canada was "way overblown."
The spectre of competition in the Canadian wireless market from the big U.S. telco had pushed Canadian telecom stocks well off their 52-week highs over the last few of months.
On the commodity markets, copper prices ran ahead following two reports – both released Monday – that showed China's manufacturing sector improved last month after prolonged weakness. China is the world's biggest consumer of copper, which itself is an economic barometer as it is used in so many applications.
The HSBC purchasing managers' index rose to 50.1 points in August, a level that indicates expansion as output and new orders edged up slightly and order backlogs rose at the fastest pace in two years. Meanwhile, the official China Federation of Logistics and Purchasing PMI showed increasing expansion, rising to 51 from July's 50, which was the highest level in 16 months.
December copper got extra lift from the strong U.S. manufacturing data and gained eight cents to $3.31 (U.S.) a pound, sending the base metals sector up 3.3 per cent. Teck Resources advanced 91 cents to $27.43 (Canadian).
The energy sector gained 0.8 per cent as oil prices shed early losses after the release of the ISM data. The October crude contract on the New York Mercantile Exchange was up 17 cents to $107.82 (U.S.) a barrel. Suncor Energy rose 51 cents to $36.01 (Canadian).
Gold prices reversed early losses with the December contract climbing $5.40 to US$1,401.50 an ounce and the gold sector rose 1.8 per cent. Goldcorp Inc. (TSX:G) gained 38 cents to C$31.48.
Financials also provided lift as TD Bank ran up $1.13 to $90.75.
Jobs data will also weigh on markets this week.
Markets are especially anxious to see how U.S. job creation fared in August. The consensus calls for the American economy to have cranked out about 180,000 jobs but recent data showing continuing declines in the numbers of people applying for jobless benefits have led some to think that number could be much higher.
In any event, traders hope the data will provide another clue as to whether the U.S. Federal Reserve will start to pare its monthly $85-billion (U.S.) of bond purchases, which have kept long-term rates low and fuelled a strong rally on many stock markets.
European bourses slipped lower as London's FTSE index moved down 0.29 per cent, Frankfurt's DAX declined 0.38 per cent and the Paris CAC 40 dipped 0.16 per cent.