S&P/TSX higher, gold stocks lower

The Toronto stock market closed higher Thursday amid a mixed reception to a string of positive earnings reports from Canada’s big banks and generally lower commodities.

The S&P/TSX composite index was 89.44 points higher at 12,821.83, held back by lower gold stocks, while the TSX Venture Exchange rose 2.24 points to 1,133.36.

The Canadian dollar was down US0.79¢ to US96.96¢, its lowest level since late June 2012, as the latest reading showed the country’s current account deficit remained at near record levels for a third straight quarter.

U.S. indexes also advanced as the latest look at fourth-quarter economic growth was disappointing while an important reading of the manufacturing sector in the American Midwest made a strong showing.

The U.S. economy grew at a 0.1% annual rate from October through December, the weakest performance in nearly two years. The U.S. Commerce Department’s revision to fourth-quarter growth was only slightly better than its initial estimate that the economy shrank at a rate of 0.1%.

And it was well below the 3.1% growth rate reported for the July-September quarter.

Other data showed that the Chicago purchasing managers index moved further into expansion territory, up 1.2 points to an 11-month high of 56.8.

The Dow Jones industrials closed down 20.88 points to 14,054.49. The Nasdaq composite index lost 2.07 points to 3,160.19 while the S&P 500 index slipped 1.31 points to 1,514.68.

The results came as financial markets remained worried about the recent Italian election, which failed to yield a clear winner, and the looming U.S. spending cuts totalling US$85 billion that are set to begin Friday.

The cuts could hit U.S. growth if no deal is reached to avoid it. Previous experience, however, suggests a last-minute deal will be cobbled together.

“You can only shock people so many times, things will probably get solved, it’s in everybody’s best interests to solve these things,” said Ian Nakamoto, director of research at MacDougall, MacDougall and MacTier. “It’s more uncertain what will happen in Italy.” Meanwhile, TD Bank, Royal Bank

of Canada and CIBC, all reported better than expected earnings for their first quarter. Royal Bank and TD also increased their dividend.

Royal Bank shares closed up 54¢ at $64.02, while TD gained 56¢ to end at $84.85. CIBC lost 74¢ to close at $83.14.

The tech sector led advancers in Toronto, with BlackBerry ahead 40¢ to $13.98.