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TSX gains on Greek hope(Baystreet Stock Market Update (Canada) Via Acquire Media NewsEdge) Metals, materials lead way The Toronto stock market was sharply higher Tuesday as traders that were feeling positive about the outcome of a crucial confidence vote for the Greek government picked up stocks from across most sectors. The S&P/TSX Composite Index zoomed 172.33 points, or 1.3%, to greet noon at 13,030.03 The Canadian dollar added 0.81 cents to 102.85 cents U.S. Greek Prime Minister George Papandreou's new government needs to get parliamentary support in that confidence vote late tonight, otherwise it would throw into question whether it can pass a critical new austerity bill by the end of the month. Without parliamentary approval for the new measures, Greece will not get the next instalment of its bailout and Greece needs those funds to avoid default. Papandreou's Socialist party holds a five-seat majority in the 300-member legislature, and a simple majority is needed to pass. Papandreou then needs to get a new austerity package voted through Parliament. Global markets have been volatile in recent weeks on worries that Greece could default on its huge debts, which could drag down Greek and European banks as well as stoking renewed fears over the public finances of other euro countries, such as Portugal, Ireland and Spain. Government debt worries and slowing economic conditions around the world have pushed the TSX almost 600 points below where it started the year. The energy sector rose with Canadian Natural Resources ahead 74 cents at $38.57 while Suncor Energy rose 51 cents to $37.47. Metal prices also advanced, with the July copper contract on the Nymex up five cents at $4.12 U.S. a pound. The base metals sector rose and First Quantum climbed $4.12 to $123.17 while Teck Resources ran up 91 cents to $44.14. Ivanhoe Mines Ltd. shares were up 60 cents to $22.68 after it said Tuesday that it will receive $502 million U.S. from Rio Tinto after the mining giant's decision to exercise all remaining share-purchase warrants that it holds in the Canadian company. The move increases Rio Tinto's ownership stake in Ivanhoe to 46.5% from 42%. Gold stocks also rose, with Kinross Gold gaining 22 cents to $14.80 while Eldorado Gold was up 23 cents to $13.43. The industrials sector was up as Korean Air signed an agreement to buy 10 of Bombardier's new CS300 aircraft with an additional 10 options and 10 purchase rights on the aircraft. Gary Scott, the president of Bombardier Commercial Aircraft, says Korean Air is the first CSeries aircraft customer in Asia and signals an entry into the fast growing Asia-Pacific market. Bombardier shares ran ahead 16 cents to $7.08. On the corporate front, Encana Corp. says talks have ended with PetroChina Company Ltd. over a proposed multibillion-dollar joint venture to tap natural gas in the Cutbank Ridge region of B.C. and Alberta. EnCana was negotiating a potential joint-venture valued at $5.4 billion, but the company says they were unable to agree on key elements of the proposed transaction. EnCana shares fell 68 cents to $28.79. There were reports that BlackBerry maker Research In Motion Ltd. is laying off as many as 200 people. RIM announced an unspecified number of job cuts last Thursday as it also delivered a disappointing earnings forecast. Its stock has plunged 26 per cent since then, but its shares edged up 67 cents to $26.08 on Tuesday. Sino-Forest shares plunged 74 cents or 26.74% to $1.99 after its largest shareholder, Paulson & Co., reportedly sold off its investment in the Chinese forestry company. Billionaire hedge fund manager John Paulson held a 14.13% stake in the company. Shares in Sino-Forest have collapsed in the wake of claims by short seller Muddy Waters Research that it fraudulently exaggerated the size of its assets. Petrominerales Ltd. shares gained $1.15 to $28.94 as it announced plans Tuesday to acquire a five per cent interest in the Oleoducto Central S.A. crude oil pipeline in Colombia from Total E&P Holdings for $281 million U.S. On the economic front, Statistics Canada said Canadian retail sales grew by a weaker-than-expected 0.3% in April and were flat, excluding the auto sector, in further evidence of a second-quarter slowdown. Elsewhere, the nation's number crunchers said Canada's composite leading indicator rose 1% in May, twice the gain expected, due largely to strength in the manufacturing sector. Analysts surveyed by Reuters had forecast, on average, an increase of 0.5% in the index. Statscan revised the April increase to 0.9% from 0.8% previously. ON BAYSTREET The TSX Venture Exchange gained 15.82 points to 1,898.09 while the Nasdaq Canada index put back on 17.93 points to 529.08 In Toronto, all but two of the 14 subgroups were higher. Metals and mining stocks ballooned 2.4%, while materials improved 2.1% and global base metals gained 1.8%. The two laggards were health-care stocks, off less than 0.7%, while real-estate was off 0.01%. ON WALLSTREET In New York, moved decidedly higher Tuesday ahead of a confidence vote for Greek Prime Minister George Papandreou. A smaller-than-expected decline in existing home sales also helped lift markets. The Dow Jones Industrial Average tacked on 104.75 points to 12,158.10, with more than 25 of the blue-chip index's 30 components trading higher. Alcoa, Caterpillar, and DuPont led the gains, with shares up more than 2%. Procter & Gamble was the biggest laggard, but was down only 0.4%. The S&P 500 gained 15.94 points to 1,294.30. The Nasdaq Composite progressed 47.71 points to 2,677.37. Whole Foods Market was the best performer on both indexes. The grocer's shares spiked more than 6% one day after its rating and price target were raised by BMO Capital Markets. Traders remain heavily focused on Greece's vote of confidence, to be held by the Greek parliament after the U.S. markets close. The vote is expected to determine whether Papandreou's government has the strength to avoid a default and secure a rescue package. Credit union regulators sued JPMorgan and Royal Bank of Scotland for selling mortgage bonds that were designed to fail -- leading federal credit unions to lose more than $800 million. Shares of JPMorgan rose more than 1%, while Royal Bank of Scotland's stock up 1%. The board of Best Buy Inc. board authorized a new $5-billion U.S. share repurchase program to replace its previous $5.5-billion U.S. share repurchase program. Shares of the company rose 3%. Shares of Renren slipped 6% even as the Chinese social-networking site reported a narrower loss in the first quarter, with sales up 47%. Drugstore chain Walgreens reported third-quarter results before the opening bell that beat expectations, posting record earnings and revenue. Separately, the company announced that contract renewal negotiations with pharmacy benefit manager Express Scripts have been unsuccessful, so it will no longer fill prescriptions using Express Scripts beginning in 2012. Shares of Walgreens fell 6%, while shares of Express Scripts slid 0.8%. Shares of Barnes & Noble rose 0.8% after the bookseller posted a wider-than-expected loss of $59.4 million U.S. for its fiscal fourth quarter and sales that missed expectations. The company said it is still reviewing the $1-billion U.S. buyout bid from Liberty Media. Media software giant Adobe will release results its quarterly earnings after the close. Adobe is expected to earn 51 cents U.S. a share. Speaking of things economic, existing home sales fell 3.8% to an annualized rate of 4.81 million in May, from a rate of five million in April, according to the National Association of Realtors. The figure was better than the 4.79-million pace economists had forecast. The Federal Reserve Open Market Committee starts its two-day meeting Tuesday. The central bank's interest rate decision will be announced on Wednesday. The price on the benchmark 10-year U.S. Treasury lost ground, with yields making their way up to 2.97%, from Monday's 2.96%. Treasury prices and yields move in opposite directions. Oil prices retreated 27 cents to $92.99 U.S. a barrel Gold futures for August delivery rose $2.40 to $1,544.20 U.S. an ounce. © 1998 - 2011 Baystreet.ca Media Corp. All rights reserved. |