Apr. 2, 2009 (Baystreet.ca) --
01:00 pm EST
Stock markets continued to rally Thursday morning amid positive news from the G20 conference in London and a change to U.S. accounting rules that could boost damaged banks' balance sheets.
The S&P/TSX Composite Index continued its rise at noon, having gained 172.59 points to 9,114.41
Shares in transportation giant Bombardier Inc. rose 31 cents to $3.35 after the Montreal-based company said it is cutting 10%, or 3,000 of its aerospace division workers. Declining aircraft sales have prompted Bombardier to reduce its business and regional jet production outlook for the coming year.
The announcement also came as the Montreal-based company reported financial results that show an increase in both profits and revenues for Bombardier's fourth quarter and full business year.
The Toronto market got added lift from rising crude prices. The energy sector climbed as EnCana Corp. gained $1.48 cents to $55.03 and Suncor Inc. ran ahead $1.41 to $29.96.
The financial sector gained as TD Bank advanced $1.10 to $45.65 and Scotiabank rose 56 cents to $32.69.
The gold sector was the biggest TSX drag, as Barrick Gold Corp. faded $2.62 to $40.18 while Goldcorp Inc. was down $3.42 to $40.58.
H&R Real Estate Investment Trust says it has obtained $425 million worth of financing for its Bow tower, a massive skyscraper project that is to serve as headquarters for energy giant EnCana Corp. Its units gained 37 cents to $7.97.
On the economic front, there were signs of agreements at the G20 conference to give more money to the International Monetary Fund, clamp down on tax havens and tighten regulation over freewheeling hedge funds.
Canadian sources told The Canadian Press the group will likely approve giving more than $500 billion U.S. in total to the International Monetary Fund so it can increase loans to struggling governments.
Other sources close to the negotiations said France and Germany had persuaded leaders to back tougher language in the final statement on stronger financial regulations to avoid a repeat of the current crisis.
On the economic front, Bank of Canada Governor Mark Carney, who won support from Prime Minister Stephen Harper to implement extraordinary monetary measures, is likely to say policy makers are ready to buy commercial paper and other corporate debt to spur the economy, and create new money to pay for it.
Carney, who has almost run out of room to cut interest rates, said he'll detail rules on April 23 for how so-called quantitative and credit easing policies would work. They may include plans for purchases of corporate debt, including commercial paper, if needed to boost the economy.
The Canadian dollar was up 1.50 cents to 80.75 cents U.S.
ON BAYSTREET
Of the 13 TSX subgroups, all but two were positive. Energy stocks led the charge, ahead 4.7%, industrials up 4.2%, metals and mining up 3.9%.
Gold was one of two losing groups, down 7.1%, the other being materials, off 3.9%
The TSX Venture Exchange down 1.94 to 968.15 while the Nasdaq Canada Index added 23.42 points to 492.43
ON WALLSTREET
The Dow Jones Industrials average sailed 254.63 points higher, to break for lunch at 8,016.23
The S&P 500 index had gained 27.86 points by noon to 838.54, while the Nasdaq picked up nearly 60 points to 1,611.50
Citigroup, Bank of America, Wells Fargo and Goldman Sachs were among the gainers.
Economically speaking, readings helped boost hopes that the U.S. is getting past the worst of its economic downturn.
There was more disquieting news on the employment front a day before the U.S. government releases its March non-farms payroll report.
The U.S. Labour Department said new jobless claims rose to 669,000 last week from the previous week's revised figure of 657,000.
That total was above analysts' expectations and the highest in more than 26 years, though the work force has grown by about half since then.
Economists forecast that tomorrow's report will show employers cut 654,000 jobs in March, while the unemployment rate increased to 8.5% from 8.1%.
Orders for U.S.-made factory goods increased 1.8% in February, the first gain after six months of large declines, the Commerce Department reported Thursday.
Excluding transportation goods, orders rose 1.6%. Excluding the 36% increase in defense goods, orders rose 0.9%. An increase of 1.5% was expected for February, compared to a decline of 1.9% the prior month.
Also, the independent Financial Accounting Standards Board changed the so-called mark-to-market accounting rules, which require companies to value assets at prices reflecting current market conditions.
The changes will allow the assets to be valued at what they would go for in an "orderly" sale, as opposed to a forced or distressed sale.
Treasury prices tumbled, raising the yield on the benchmark 10-year note to 2.71% from 2.65% Wednesday. Treasury prices and yields move in opposite directions.
The May crude contract on the New York Mercantile Exchange rose $3.60 to $44.79 U.S. a barrel.
The June bullion contract on the Nymex moved down $27.40 to US$900.30 U.S. an ounce.