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Jan. 19, 2010 (Baystreet.ca) --
Lower energy and base metal stocks left the Toronto stock market little changed mid-afternoon Tuesday.
The S&P/TSX Composite Index snuck 12.88 points into the green to end the day at 11,763.42.
The Bank of Canada today announced that it is maintaining its target for the overnight rate at 0.25%, and will likely do so until the end of the second quarter of 2010. The bank said in its statement that the economy will grow by 2.9% in 2010 and 3.5% in 2011, after contracting by 2.5% in 2009.
The central bank warned that the main risks to recovery are a slower-developing global rebound and persistent strength of the Canadian dollar.
Traders overlooked today's report from Statistics Canada, which said the country's composite leading indicator soared 1.5% in December, largely helped by household spending and a surging stock market.
The TSX energy sector was down, as Suncor Energy slipped seven cents to $36.93 while Canadian Natural Resources gained nine cents to $72.07.
Epsilon Energy Ltd. gained 17 cents or 5.67% to $3.17. The Toronto-area company said Monday that it has a deal with Chesapeake Energy Corp. to co-develop a shale gas property in Pennsylvania.
The base metals sector dipped as March copper rose eight cents to $3.45 U.S. a pound. Equinox Minerals was down a dime to $4.00 while Labrador Iron Mines Holdings jumped $1.47 or 26.4% to $7.04.
The TSX financial sector was up, with Bank of Montreal ahead 23 cents to $53.99.
In other earnings news, online brokerage TD Ameritrade Holding Corp. says lower interest rates and higher expenses contributed to a 26 per cent drop in first-quarter profit. The bank reported earnings of $136.2 million, or 23 cents a share, missing analyst expectations by three cents a share.
TD Bank owns a 45% stake in the brokerage, which also missed on revenue, but its shares were off a penny to $64.09.
The gold sector advanced, as Barrick Gold Corp. gained 59 cents to $40.91.
The telecom sector made inroads, as Rogers Communications rose 56 cents to $31.81.
Units in Supremex Income Fund tumbled 80 cents or 26.6% to $2.20 after Canada's largest provider of stock and custom manufactured envelopes announced it is reducing its monthly distribution from five cents a unit to one cent. It cited “the renewal of its credit facility and... the continuing challenges facing its business.”
The Canadian dollar erased 22 cents to 97.03 cents U.S.
ON BAYSTREET
Of the 14 TSX subgroups, eight ended the day higher. Health-care stocks were 2.7% higher, followed by global base metals, ahead 1.8% and gold stocks, jumping 1%.
The half-dozen gainers were tethered mostly to information technology, off 0.3%, while utilities and consumer discretionary stocks, down 0.2%.
The TSX Venture Exchange gained 7.20 points to 1,612.92, while the Nasdaq Canada index subtracted 2.21 points to 728.71.
ON WALLSTREET
In New York, stocks rallied Tuesday, with IBM leading a tech charge ahead of its quarterly results due out after the closing bell. A variety of health care and consumer product companies also added to the run, as investors sought to restart the run.
The Dow Jones Industrials screamed ahead 115.78 points to finish at 10,725.43. The S&P 500 tacked on 14.20 points to 1.150.23, and the Nasdaq regained 32.41 points to 2,320.40.
Citigroup's quarterly loss, a stronger dollar and Kraft's buyout of Cadbury were also in the mix.
Stocks opened weaker following Citigroup's results, but soon turned higher as investors found reason to jump back into the market after Monday's holiday.
Gains were pretty broad based, with 25 of 30 Dow components rising, led by Caterpillar, IBM Johnson & Johnson, McDonald's, 3M, Merck, 3M and Procter & Gamble.
Health-care stocks jumped on talk that a Republican election to the Massachusetts U.S. Senate seat previously held by the late Ted Kennedy could stall or kill health care reform by ending the Democrats' filibuster-proof status.
IBM led the list of tech gainers, ahead of its quarterly profit report, due out after the close.
The company is expected to report higher earnings versus a year ago.
All financial markets were closed Monday for the Martin Luther King holiday. Markets on Friday ended lower despite better-than-expected profit reports from JPMorgan Chase and Intel.
After a robust 2009, stocks were expected to drift at the beginning of the new year. But the momentum has remained positive and year-to-date, the S&P 500 is up 3%.
Financial firm Citigroup reported a $7.6-billion-U.S. quarterly loss, partly due to the bank paying back the government $20 billion U.S. in bailout funds. On a per-share basis, Citigroup lost 33 cents, in line with forecasts, after reporting a loss of $2.44 U.S. a share in the prior year's quarter.
On the upside, the company said consumer credit losses dropped in the quarter, and that it also set aside less money for bad loans during the quarter.
Some 57 of the companies in the S&P 500 are due to report results this week, with the focus on banks. Wells Fargo, Bank of America, Morgan Stanley, American Express and a number of regional banks are all due.
S&P 500 earnings are expected to have risen 186% versus a year ago and revenue is expected to have risen 7% according to the latest forecast from earnings tracker Thomson Reuters.
But the jump is largely attributable to a spike in financial sector results versus an abysmal fourth quarter of 2008 amid the height of the financial crisis. Without the financial sector, earnings growth slips to 8% and revenue growth falls to 1%.
British candy giant Cadbury agreed to a larger $19.5-billion-U.S. takeover offer from U.S. food maker Kraft Foods in a deal that puts an end to a four-month fight. The board Tuesday recommended shareholders take Kraft's cash-and-stock offer in a move that will create the world's biggest chocolate maker.
Shares of Kraft, a Dow component, fell 1.8%. American-traded shares of Cadbury rose 5.6%.
Treasury prices fell, raising the yield on the 10-year note to 3.70% from 3.67% late Friday. Treasury markets were closed Monday. Treasury prices and yields move in opposite directions.
The price of a barrel of oil gained 97 cents to $78.98 U.S.
Gold prices gained $10 to $1,141 U.S.