The Toronto stock market closed slightly higher Thursday amid reassuring economic data from the United States. Both the Dow Jones industrial average and S&P 500 index scored another record close.
The S&P/TSX composite index rose 12.29 points to 13,362.06, held back by declines in base metals and utilities stocks.
Sharply lower oil prices helped push the Canadian dollar down 0.59 of a cent to 94.38 cents US.
U.S. indexes were higher as the Dow Jones industrials climbed 24.53 points to 16,097.33, the Nasdaq gained 27 points to 4,044.75, while the S&P 500 index edged up 4.48 points to 1,807.23.
“Today’s economic news was generally favourable,” said Terry Sandven, chief equity strategist for U.S. Bank Wealth Management.
“In the absence of bad news, the path of least resistance for equities is up.”
As traders get set to wind down for the American Thanksgiving holiday on Thursday when U.S. markets will be shuttered, they took in data showing U.S. jobless insurance claims, which are a proxy for layoffs, fell by 10,000 last week to 316,000. Economists had expected a slight rise.
Orders for American durable goods fell two per cent in October, which was in line with expectations. Excluding transportation, orders dipped 0.1 per cent.
A key gauge of the manufacturing sector in the U.S. Midwest showed slower expansion. The Chicago purchasing managers index dropped to a higher than expected 63 in November from 65.9 in October.
Meanwhile, the U.S. Conference Board said its leading economic indicator rose 0.2 per cent in October. That data gives an indication on where the American economy is heading over the next six months.
And the University of Michigan released its latest reading on U.S. consumer sentiment. It rose to 75.1 in November from 73.2 in October, better than the 73 reading that had been expected.
The TSX gold sector led advances, up 1.2 per cent as traders bought into a segment that is down almost 50 per cent year to date as gold prices have also fallen amid speculation that the U.S. Federal Reserve is set to taper its monthly US$85 billion of bond purchases, which have kept rates low and supported a stock market rally. Also, inflation is very low in many parts of the world.
“It’s only going to go down for so long and all of a sudden, you have to think that it’s time to turn around and move it up,” said Fred Ketchen, manager of equity trading at ScotiaMcLeod..
December bullion shed early gains and fell $3.60 to US$1,237.90 an ounce. Iamgold (TSX:IMG) was up nine cents at C$4.41 and Kinross Gold (TSX:K) improved by five cents to $4.92.
The telecom sector was ahead 0.7 per cent as Rogers Communications (TSX:RCI.B) was up 96 cents to $47.19 a day after reaching a 12-year, $5.2-billion agreement with the National Hockey League that gives the company the league’s broadcast and multimedia rights in Canada.
Gains in railway stocks also lifted the TSX as Canadian National Railways (TSX:CNR) ran up $1.17 to $118.61.
Financials were also positive with Manulife Financial (TSX:MFC) ahead 18 cents to $20.36.
The interest rate sensitive utilities sector lost one per cent with TransAlta Corp. (TSX:TA) down 65 cents to $14.02. The sector has been under selling pressure amid rising U.S. bond yields amid speculation about when the Federal Reserve might cut back on its US$85 billion of monthly bond purchases.
“And I don’t think we’re going to see any change in that sector any time soon,” said Ketchen.
The base metal sector was down 0.8 per cent as March copper dropped three cents to US$3.19 a pound. Teck Resources (TSX:TCK.B) dropped 28 cents to C$25.24.
The energy sector lost 0.34 per cent as the January crude contract fell $1.38 to US$92.30 a barrel. Supply data from the U.S. Energy Department for last week showed oil supplies rose about three million barrels, versus a decline of 1.5 million barrels that had been expected. Crude supplies have now increased for the past 10 weeks. Canadian Oil Sands (TSX:COS) fell 32 cents to C$19.81.
On the corporate front, Hewlett-Packard rose $2.27 or 9.05 per cent to US$27.36 as the world’s second-largest maker of PCs issued a strong profit prediction for the current quarter.