Mar. 12, 2009 (Baystreet.ca) --
12:30 pm EST
North American markets moved higher for a third session Thursday with leadership again coming from the financial sector.
Toronto's S&P/TSX composite index was pumped 77.21 points to 8,088.23
The turnaround in sentiment in the banking sector followed a surge in optimism after a report Tuesday that American financial giant Citigroup was profitable in the first two months of the year. The recent gains have been spread across most sectors, particularly energy as oil prices have firmed around $45 U.S. a barrel.
Analysts say the rally has also been fed by short covering, which occurs when investors need to buy stock to replace shares that were borrowed and then sold on expectations of a market decline.
The TSX financial sector was up again, as Scotiabank gained 47 cents to $29.47 while Bank of Montreal climbed $1.13 to $31.23.
Financials were supported in part by a comment from a senior U.S. lawmaker who said Congress will have to act to improve accounting rules that force banks to value assets at current prices unless regulators immediately do so. Rep. Paul Kanjorski, chairman of a House panel, held out the threat Thursday of legislation to pressure the Securities and Exchange Commission.
The energy sector rose as Petro-Canada was up 58 cents to $29.39 and Suncor Inc. rose 50 cents to $30.86.
The gold sector was up, as Barrick Gold Corp. climbed $1.24 to $36.58.
Industrials were also supportive as Bombardier Inc. gained seven cents to $2.78 and Canadian National Railways advanced 49 cents to $42.33.
Nortel Networks Corp. shares were off 1.5 cents to 8.5 cents after the Wall Street Journal said the telecom maker is in talks to sell its two main businesses to rivals, a sign the company could break itself apart rather than emerge from bankruptcy restructuring under court protection from creditors as planned.
Vancouver-based silver producer Silver Wheaton Corp. has reached a deal to purchase Silverstone Resources Corp. in an all-stock deal valued at $190 million. Silver Wheaton shares gained 15 cents to $8.09 while Silverstone shares ran ahead 21 cents to $1.46.
Health services company MDS Inc. said Thursday its restructuring efforts are yielding positive results as the company reported a quarterly profit of US$2 million, down sharply from year-earlier net earnings of $19 million. Quarterly net revenue slipped to $257 million from $296 million reported during the same period the year before and its shares gained 80 cents to $7.67.
The Canadian dollar gained back 0.23 cents worth of muscle in the early going Thursday to 77.59 cents U.S.
BAYSTREET
Of the 13 TSX sub-groups, 11 were pointed higher, led by health-care stocks, ahead 4.0% gold, up 2.9% and real-estate, advancing 2.7%.
The two losing groups were utilities 0.9%, while telecoms were down 0.5%.
The TSX Venture Exchange picked up 5.68 points to 829.58, while the Nasdaq Canada index eased back 0.36 points to 404.41
ON WALLSTREET
The Dow Jones industrial average gained new strength by the lunch hour, advancing 101.39 points to hit midday at 7,031.79
The S&P 500 index gained 11.26 points to 732.62 while the Nasdaq composite index reversed its course and tacked on 18.65 to 1,390.29
Shares in Dow component General Electric were ahead 70 cents to $9.198 U.S. even as Standard and Poor's cut the conglomerate's long term rating to AA-plus from AAA with a stable outlook. But investors were relieved the cut wasn't as deep as some anticipated.
Among drug makers, Biotech Gilead Sciences said it will buy drugmaker CV Therapeutics for $1.4 billion. CV shares jumped 28%, while Gilead shares fell 2%.
Pfizer said that a late-stage clinical trial of its cancer drug Sutent has been stopped early after the drug produced a significant benefit in patients with a rare form of cancer. Shares of the Dow component jumped 4.5%.
Economically speaking, the U.S. Commerce Department reported that retail sales edged down 0.1% last month, much less severe than the 0.5% drop that economists had expected.
Excluding autos, retail sales rose 0.7%.
The U.S. government also revised January's performance to show a 1.8% rise, the biggest increase in three years and stronger than the 1% gain that was originally reported.
Also, the U.S. Labor Department reported that first-time requests for unemployment insurance increased to 654,000 from the previous week's upwardly revised figure of 645,000, above analysts' expectations.
The number of people receiving benefits for more than a week increased by 193,000 to 5.3 million, the most on record dating back to 1967. That's the sixth time in the past seven weeks that the jobless claims rolls have set a new record.
Treasury prices inched higher, lowering the yield on the benchmark 10-year note to 3.01% from 3.02% Wednesday. Treasury prices and yields move in opposite directions.
The April crude contract on the New York Mercantile Exchange moved ahead $1.52 to $43.85 U.S. a barrel.
The April bullion contract was up $16.40 to $903.50 U.S. an ounce