Canadian and U.S. stocks went in different directions on Thursday, as investors speculated on whether the Federal Reserve is ready to pump more stimulus into the economy and whether Greece will vote to tear up its bailout agreement with the rest of Europe.
In Toronto, the S&P/TSX lost 31.45 points, to close at 11466.42. Only the utilities and energy sectors gained, as Research In Motion Ltd., Bombardier Inc., Suncor Energy and Manulife Financial led the market in a broad selloff.
In New York, the S&P 500 advanced by 14.22 points, to 1329.1 points, and the Dow Jones industrial average increased by 155.53 points, to 12651.91 points. Telecommunications, financials and energy stocks led the advance. Sprint Nextel rose more than 5 per cent and Verizon Communications gained 2 per cent, as some U.S. wireless carriers introduced new pricing plans. Bank of America and General Electric each rose 2 per cent.
U.S. reports on Thursday showing weaker-than-expected employment data and a drop in the cost of living had many investors thinking the Fed will support stimulus efforts at its meeting next week.
U.S. consumer price index figures showed that the cost of living declined 0.3 per cent in May, more than forecasted and the biggest drop since December 2008. In addition, claims for jobless benefits unexpectedly climbed by 6,000 to 386,000 last week.
In the meantime, the markets have been more quiet than usual. Investors will be watching the results of Greece’s elections on Sunday closely. A win by the socialist party would take the country much closer to a euro zone exit.
Hopes of greater stimulus helped lift the price of commodities. Oil rose $1.29 (U.S.) a barrel to $83.91. Copper gained 2.15 cents to $3.361 a pound. Gold added 20 cents an ounce to close at $1,619.60. The Canadian dollar ended the session up 0.6 per cent at 97.70 cents.