TORONTO — The Toronto stock market closed at a three-and-a-half month high Thursday as further signs of U.S. economic growth helped lift most sectors, including financials even as TD Bank (TSX:TD) delivered earnings that narrowly missed expectations.
The S&P/TSX composite index was up 107.31 points at 12,111.09 while the TSX Venture Exchange gained 13.62 points to 1,531.25.
TD said its profits grew 29 per cent in the third quarter to $1.18 billion thanks to lower loan losses and strong earnings in its domestic retail business. However, on an adjusted basis, earnings per share were $1.43, falling a penny short of analyst expectations, according to Thomson Reuters. But its stock advanced $1.05 to $73.17.
“Whenever you’re making over a billion dollars in a quarter, that’s not too bad. And that’s generally what’s going on right now,” said Paul Vaillancourt, vice-president of Canadian Wealth Management in Calgary, who said he thinks it a good time to buy financials.
“There’s opportunities to look at and...we have been underweight financials but with this quarter out of the way, no major surprises, we’re good to maybe go market weight the sector.”
In other earnings news, Laurentian Bank (TSX:LB) reported that its net income increased by five per cent to $30.1 million in the third quarter as the Montreal-based bank’s revenues grew to $188.8 million. Its shares dropped 86 cents to $46.70.
Elsewhere in the sector, Scotiabank (TSX:BNS) rose 96 cents to $52.21.
The Canadian dollar edged 0.14 of a cent lower to 94.92 cents US.
The information technology sector was also strong, up 1.7 per cent with Celestica (TSX:CLS) ahead 23 cents at $8.36, while CGI Group (TSX:GIB.A) rose 53 cents to $15.07.
Shares in Research In Motion Ltd. (TSX:RIM) inched up two cents to $46.50 after the chief of the United Nations’ telecommunications agency urged the BlackBerry manufacturer to allow foreign law enforcement agencies access to its customers’ data. A standoff between RIM and foreign governments over access to customers’ data has sunk the company’s share price about 20 per cent since the end of July.
Gold stocks were strong as the December bullion contract on the New York Mercantile Exchange moved up $5.30 to US$1,253.40 an ounce. Goldcorp Inc. (TSX:G) was ahead 48 cents at C$46.18 and Eldorado Gold Corp. (TSX:ELD) gained 32 cents to C$20.53.
The base metals sector was ahead one per cent with the December copper contract on the Nymex up two cents at US$3.50 on top of a three per cent run-up on Wednesday. Taseko Mines (TSX:TKO) advanced 16 cents to C$4.95 while Teck Resources (TSX:TCK.B) improved by $1.14 to C$38.78.
The energy sector was 0.54 per cent ahead as oil prices shook off early losses and added $1.11 to US$75.02 on top of Wednesday’s gain of almost US$2. Oil prices were positive following U.S. economic data but accelerated after an oil production platform in the Gulf of Mexico exploded. Shares of Mariner Energy, which owns the platform, were down 52 cents to US$22.83 in New York.
In Toronto, Canadian Natural Resources (TSX:CNQ) climbed 49 cents to C$35.59.
U.S. markets were slightly higher amid a mixed bag of economic data. The Dow Jones industrial average gained 50.63 points to 10,320.1. The Nasdaq composite index was up 23.17 points at 2,200.01 while the S&P 500 index gained 9.81 points to 1,090.1.
The U.S. Labour Department said new claims for unemployment benefits fell by 6,000 to 472,000 last week. Economists had been expecting slightly more claims.
The news came a day before the U.S. government releases its non-farm payrolls report for August.
Other data showed that the number of American buyers who signed contracts to purchase previously occupied homes increased in July but remained well below last year’s levels. The National Association of Realtors said its seasonally adjusted index rose 5.2 per cent from a month earlier to a reading of 79.4. Economists surveyed by Thomson Reuters had expected the index would fall to 74.9.
And orders to U.S. factories managed a slight 0.1 per cent gain in July but, excluding transportation, orders were down 1.5 per cent, the biggest drop in this category in 16 months.
In other corporate news, Alberta pension fund manager AIMCo says it had been approached by some government wealth funds and others to make a bid for fertilizer giant PotashCorp. (TSX:POT).
But AIMCo CEO Leo de Bever said Thursday he’s had trouble working out the economics of a bid to rival the US$38.6-billion deal offered by Australian-based global miner BHP Billiton. De Bever added it’s not AIMCo’s intention to get involved in a bid for political reasons. Potashcorp shares were ahead $2.35 at C$156.25.
Dell Inc. said it was walking away from a bidding contest with rival Hewlett-Packard Co. for data-storage maker 3Par Inc. Dell said Thursday it won’t match HP’s offer to pay US$33 per share for 3Par. Dell shares rose 24 cents to US$12.36.
Harry Winston Diamond Corp. (TSX:HW) (NYSE:HWD) said it earned US$16.5 million in its second quarter, reversing a year-ago loss as sales were up 62 per cent to US$153.7 million. The company’s shares surged $2.10 or 19.5 per cent, to C$12.85.
Satellite technology company Com Dev International Ltd. (TSX:CDV) is replacing chief executive John Keating, effective immediately. The move comes after the company’s recent warning of a looming loss and falling revenues. Its shares gained nine cents to $1.83.
Garda World Security Corp. (TSX:GW) shares gained 64 cents to $8.79 as it reported that its profit rose 31 per cent in the second quarter to $5.3 million. The Montreal-based company, which operates armoured trucks and provides cash logistics services to the banking industry along with security at airports and other locations, said earnings were equal to 17 cents per diluted share, two cents better than expectations.
