The Toronto stock market closed slightly higher Wednesday as the Syrian civil war continued to cast a shadow over trading and investors wondered if the U.S. will end up leading a military strike against the country, which is accused of using poison gas against its own civilian population.
The S&P/TSX composite index was up 17.31 points to 12,757.81 led by gains in utilities and industrials.
The Canadian dollar rose 0.34 of a cent to 95.31 cents US as the Bank of Canada said it was keeping its key rate unchanged at one per cent, where it’s been since September 2010 amid a tough recovery from the 2008 crash.
Strong vehicle sales data helped U.S. indexes gain momentum throughout the day while investors weighed President Barack Obama’s effort to win support in Congress for a military strike on Syria.
Obama said Tuesday that he’s confident Congress will authorize a military strike. Congress could vote as early as next week, after it returns from summer break.
The Dow Jones industrials jumped 96.91 points to 14,930.87.
General Motors said its sales rose 15 per cent last month, while Chrysler and Ford each reported 12 per cent gains. Toyota posted the biggest increase as sales rose nearly 23 per cent since August of last year. GM stock jumped 4.9 per cent while Ford gained 3.37 per cent.
The Nasdaq gained 36.43 points to 3,649.04 and the S&P 500 index added 13.31 points to 1,653.08.
“I think that goes to show you that this market is resilient, which it’s been for a while – the U.S. market especially,” said Allan Small, senior adviser at DWM Securities.
“I think people are looking to put money to work all the time, where a few years ago, it might have been the opposite case – any little thing would result in traders taking their money and running.”
Traders also took in some positive data on the health of the U.S. economy during August.
The Federal Reserve said in its latest regional survey that the economy expanded at a modest to moderate pace in August.
The Fed said in its so-called Beige Book that manufacturing expanded modestly, lending activity weakened somewhat while hiring held steady or increased modestly.
Traders are anxious to see if the Fed decides later this month to start winding up its monthly $85-billion (U.S.) of bond purchases.
The beaten-down utilities sector led advancers, up 1.43 per cent with Capital Power (TSX:CPX) ahead 45 cents to $20.90.
The component, along with other interest rate sensitive sectors, has been hit hard ever since Fed chairman Ben Bernanke first mentioned the possibility of Fed tapering back in May, which has had the effect of pushing bond yields higher.
Industrials also boosted the TSX and Canadian Pacific Railway (TSX:CP) rose $2.19 to $125.97.
The tech sector advanced with smartphone maker BlackBerry (TSX:BB) ahead 53 cents or 4.93 per cent to $11.28.
Commodity prices headed lower but the metals and mining sector was slightly higher as December copper fell six cents to $3.24 a pound, erasing most of Tuesday’s gain that followed strong manufacturing data from China and the U.S.
The telecom sector was the leading decliner, down 0.57 per cent, giving back some of the four per cent surge registered Tuesday after U.S. telecom giant Verizon agreed to buy out the remaining stake in its mobile phone business from Vodafone in a massive, US$130-billion deal. At the same time, Verizon made it clear it wasn’t interested in entering the Canadian wireless market. Rogers Communications (TSX:RCI.B) slipped 71 cents or 1.59 per cent to $43.88 after running up seven per cent on Tuesday.
October crude on the New York Mercantile Exchange fell $1.31 to US$107.23 and the energy sector was off 0.2 per cent.
The gold sector was off 0.16 per cent as the December bullion contract lost $22 to US$1,390 an ounce.