THIRD DAY OF GAINS FOR TSX.
Canada’s benchmark stock index ended the day Thursday with its third straight gain despite an afternoon of choppy trading, as investors speculated about whether Canada’s big banks would follow Bank of
Nova Scotia’s example and sell shares to raise cash.
The S&P/TSX composite index rose 35.82 points to 12,553.48. Six of the 10 sub-indexes advanced, led by technology, which rose 2.78% due in large part to a 14.58% gain in
Open Text shares, which rose to $60.34 after the company reported second-quarter earnings that beat estimates.
Financials was the most heavily weighted decliner, falling 0.35% as Canada’s big banks fell following Scotiabank’s share sale. Scotiabank slipped 0.89% to $51.38,
Royal Bank of Canada was down 0.66% to $52.93 and Toronto-dominion Bank was off by 0.27% to $77.75.
The price of crude oil fell US$1.25 to US$96.36 a barrel, while gold rose US$9.70 to US$1,756.80 an ounce.
The Canadian dollar closed above parity with its U.S. counterpart for the second straight day, though it slipped five basis points to US$1.0004.
Otherwise it was a fairly quiet day on global markets following Wednesday’s strong gains and ahead of Friday’s job figures in both Canada and the U.S.
“The main issue dogging markets (Thursday) is that U.S. indices have now pretty much clawed back all of their 2011 bearmarket losses and are back trading where they were in the early summer,” said analyst Colin Cieszynski of CMC Markets. “Although recession fears continue to ease, there’s a growing question of whether markets and expectations have rebounded too far too quickly, leaving traders grasping for reasons to extend the rally further. The upcoming slate of announcements may help to clarify whether the global economy is strengthening enough to justify additional gains.”
Those announcements include global service purchasing managers’ index numbers and U.S. factory orders. Wednesday’s big gains followed better-than-expected manufacturing PMI numbers, which bolstered sentiment that the global economic recovery is progressing.
Markets remained mixed in the U.S. on Thursday as initial jobless claims came in lower than expected, but announced layoffs rose in January by 53,400, according to a report from Challenger, Gray & Christmas, up from a 41,700 increase in December, and construction PMI of 51.4 was lower than December’s figure of 53.2 and below expectations of 52.5.
The Dow Jones industrial average slipped 11.05 points, or 0.09%, to 12,705.41, while the Nasdaq composite advanced 11.41 points, or 0.40%, to 2,859.68.