The close: TSX climbs to 5-week high, led by financials and technology

Canada’s main stock index rose to a five-week high on Thursday as financial and technology shares led broad-based gains, while Husky Energy Inc. fell more than 8 per cent after an explosion at the company’s refinery in Superior, Wisc.

The Toronto Stock Exchange’s S&P/TSX composite index unofficially closed up 127.84 points, or 0.82 per cent, at 15,637.59. All of the index’s 10 main groups ended higher.

The heavyweight financial sector, which rose 1.1 per cent, was boosted by Toronto-Dominion Bank and Bank of Nova Scotia, both of which gained about 1.2 per cent.

Energy stocks gained 0.5 per cent. Cenovus Energy Inc. rose 1.3 per cent, while Suncor Energy Inc. increased 1.1 per cent.

Shares of Husky Energy Inc fell 8.1 per cent after oil and gas producer lowered its 2018 output forecast, saying it would temporarily cut heavy oil production due to weakening prices of the commodity. The company also sustained a fire at its Superior, Wisc., refinery that injured at least 10 people.

Stantec Inc. rose 3.9 per cent after the company initiated a strategic review of construction services provider MWH Constructors, a part of its company.

New Gold Inc. shares fell 6.5 per cent after the company reported first-quarter results. The company was the largest decliner on TSX.

U.S. stocks advanced on Thursday with each of Wall Street’s major indexes ending the session up 1 per cent or higher, boosted by solid earnings results and a rebound in technology stocks as U.S. bond yields pulled back.

The Dow Jones Industrial Average rose 238.44 points, or 0.99 per cent, to 24,322.27, the S&P 500 gained 27.55 points, or 1.04 per cent, to 2,666.95 and the Nasdaq Composite added 114.94 points, or 1.64 per cent, to 7,118.68.

Facebook jumped 9.1 per cent following its impressive earnings beat, which appeared to calm worries over the fallout of the Cambridge Analytica privacy scandal.

Chipmakers Advanced Micro Devices and Qualcomm were up 13.7 per cent and 1.5 per cent, respectively, after quarterly results that beat Wall Street estimates, calming worries over weak smartphone demand.

Their advances helped lift the Philadelphia Semiconductor index 2.1 percent, putting it on track to break its six-day losing streak and post its best day in three weeks.

“I think it’s been pretty much good earnings across the board,” said Gary Bradshaw, portfolio manager of Hodges Capital Management in Dallas. “Revenues have been strong, so the earnings are not just cost-cutting as they were a couple years back. But there’s obviously rising costs.”

The yield on U.S. 10-year Treasuries dipped below the 3-per-cent level as buyers emerged following a sell-off fueled by worries over growing U.S. debt issuance and rising costs.

“It gives investors a little encouragement that rates aren’t going to be running sky high, but the market’s acting great just on good earnings,” said Bradshaw.

So far, 45 per cent of S&P 500 companies have reported first-quarter earnings, with 79.7 per cent beating consensus estimates. Analysts see 23.1-per-cent earnings growth for the quarter, based on a blend of actual and estimated results.

Amazon shares were up 4 per cent in advance of the online retailer’s earnings announcement.

After the bell, the online retailer reported a 43-per-cent jump in first-quarter revenue on Thursday, driven by a surge in online shopping and higher demand for its cloud services.

Amazon, which reported it had over 100 million Prime subscribers last week, said its net sales rose to $51.0-billion from $35.7-billion, a year earlier.

In Europe, Volkswagen shares climbed 2.66 per cent even though its first-quarter operating profit fell as investors were encouraged by its new chief executive, the car maker’s financial health and lower provisions for the diesel emissions scandal.

The pan-European FTSEurofirst 300 index rose 0.91 per cent and MSCI’s gauge of stocks across the globe gained 0.76 per cent.

The FTSE index marked its best day since April 5 while the MSCI index was on pace to snap a five-session losing streak, its longest since November.

The euro dropped to session lows after ECB President Mario Draghi hailed “solid” euro zone growth but kept rates unchanged, without a clear signal about ending the central bank’s quantitative easing program. The dollar strengthened as short positions unwound on the U.S. economic data.

The euro fell to its lowest level against the dollar since mid-January, at $1.2096, after the ECB announced its decision to keep monetary policy unchanged. The single currency had initially rebounded after Draghi played down concern over recent softness in data.

Oil prices gained on Thursday as the risk of renewed U.S. sanctions on Iran, plunging Venezuelan output, and robust global demand shook off the effects of a strong dollar.

Global benchmark Brent crude futures gained 74 cents to settle at $74.74 a barrel, while U.S. West Texas Intermediate (WTI) crude were up 14 cents to $68.19 a barrel.

“Oil has had a very good week so far given what the dollar has done,” said Bill Baruch, president of Blue Line Futures in Chicago.

The dollar against a basket of currencies hit its highest since mid-January. A stronger greenback makes it more expensive to buy dollar-denominated commodities like oil.

“The dollar has held crude back from gaining further ground. I expect the market to have a good finish for the week given the uncertainty around the Iran deal,” Baruch said.

A top adviser to Iran’s supreme leader said Tehran would not accept any change to the 2015 nuclear deal, as Western signatories prepare a new package in the hope of persuading U.S. President Donald Trump to stick with the accord.

This comes a day after French President Emmanuel Macron said he expected Trump to pull out of the agreement.

Trump will decide by May 12 whether to restore the sanctions, which would probably result in a reduction of Iranian oil exports. Brent has gained about 6 percent this month thanks to expectations that the United States could do so.

“The rally seems to be intact and is looking for the next spark to push it higher. That spark could come from reinstituting sanctions. But not only is there the possibility of sanctions on Iran, but there’s also the possibility of Venezuelan and Russian sanctions,” said Gene McGillian, manager of market research at Tradition Energy in Stamford, Connecticut.

Reuters