Toronto stock market takes gains on commodities US earnings season

by David Friend, The Canadian Press Posted Oct 16, 2012 4:30 pm MDT AddThis Sharing ButtonsShare to TwitterTwitterShare to FacebookFacebookShare to RedditRedditShare to 電子郵件Email Toronto stock market takes gains on commodities, US earnings season TORONTO – The Toronto stock market made an enthusiastic gain on Tuesday as commodities prices strengthened alongside a round of U.S. earnings reports that gave traders further confidence.The S&P/TSX composite index rose 177.74 points to 12,407.70 on strength across every sector led by gold and materials stocks. The TSX Venture Exchange gained 17.05 points to 1,299.78.The Canadian dollar fell 0.7 of a cent to 101.34, coming off a steeper decline of 0.83 cents earlier in the session.In commodities, December gold bullion rose $8.70 to US$1,746.30 an ounce, while TSX gold stocks led gainers. Copper prices were relatively unchanged with the December contact at US$3.70 a pound.Oil prices were slightly higher with the November contract on the New York Mercantile Exchange up 24 cents to US$92.09 a barrel, while the TSX energy sector gained 1.1 per cent.The latest comments from Bank of Canada governor Mark Carney late Monday afternoon were also a factor. A speech by Carney left economists debating the importance of his leaving out an often-repeated phrase that “modest withdrawal of the present considerable monetary policy stimulus may become appropriate.”The central bank’s pronouncements are closely watched by economists as a signal of change in interest rate policies, which can affect currency rates.On Wall Street, a flurry of earnings reports gave traders much to chew on, with major companies in the health-care, banking and consumer industries reporting quarterly results. The Dow Jones industrials rose 127.55 points to 13,551.78, the Nasdaq composite index added 36.99 points to 3,101.17 and the S&P 500 index was up 14.79 points to 1,454.92.Mattel and UnitedHealth posted strong results for the third quarter. Goldman Sachs and Johnson & Johnson both beat Wall Street expectations. Coca-Cola Co. said its net income rose three per cent.Meanwhile, the Labor Department said that U.S. consumer prices rose 0.6 per cent in September because of more expensive gas.In Europe, an unexpectedly large improvement in German investor confidence, as surveyed by the ZEW institute, also helped shore up sentiment. The rise in confidence also gave the euro some lift.The euro has also garnered support from expectations that Spain will soon make a request to tap a European Central Bank bond-buying facility and that Greece will get its next batch of bailout funds. The problems of both debt-ridden countries are likely to be featured at a meeting of EU leaders later this week.“I think people feel a little bit better about global growth,” said Ian Nakamoto, director of research at MacDougall, MacDougall and MacTier.“We’re back into a slow growth economic environment and earnings are relatively resilient. I think we’re past the crisis stage with both the U.S. and Europe. We’ve got them contained — meaning we know what to do and how to do it — and can move further up from here.”Citigroup investors were stunned to learn Tuesday that Vikram Pandit stepped down as CEO, after steering the bank through the aftermath of the 2008 financial crisis. Pandit’s replacement as CEO is Michael Corbat, the current CEO of Citigroup’s Europe, Middle East and Africa division, the bank said.Also in the news is a plan by Loblaw Companies Ltd. (TSX:L) to cut about 700 jobs at its operations, mostly in administration and management, as it looks to cut costs. Loblaw shares rose 84 cents to $34.72.

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