TSX rises to near record close; oil prices head upwards amid Iraqi conflict
TORONTO - The Toronto Stock Exchange rose Friday, pushed higher by the burgeoning energy sector amid concerns that oil supplies could soon be at risk if an advance by insurgents in Iraq continues.
The S&P/TSX composite index added 91.98 points to 15,001.61 â€” a few points shy of its record-close of 15,073 reached in June 2008, just before the Great Recession sent stocks plummeting.
The Canadian dollar was down 0.01 of a cent to 92.11 cents US.
In Iraq, Islamic militants vowed to march on Baghdad after pushing deep into parts of the country's Sunni heartland northeast of the capital that was previously controlled by U.S. forces, raising concerns over global oil supplies.
The July crude contract advanced 38 cents to US$106.91 a barrel.
On Wall Street, U.S. indexes rallied as the Dow Jones industrials rose 41.55 points to 16,775.74, the Nasdaq climbed 13.02 points to 4,310.65 and the S&P 500 saw an uptick of 6.05 points to 1,936.16.
Andrew Pyle, senior wealth adviser at Scotia McLeod in Peterborough, Ont., said he saw Friday's rally as "more of a tentative pickup."
"There is still a very strong possibility that we see the situation in Iraq get worse over the weekend," he said, adding that it that were to happen chances would be greater that oil could reach the US$110-a-barrel level seen last August and September.
"If we were to see that on the weekend, then you would see a totally different picture for stocks Monday then we're currently seeing for Friday."
Pyle added that analysts and traders have already been questioning whether equities are overvalued going into the summer and that if the energy markets were to go into crisis mode, it would only exacerbate those fears.
"Traders believe that fundamentals in the U.S., and maybe globally, don't support current valuations," he said. "It's not to say we would see a significant correction, but the highs that we saw in May and June really require a stronger fundamental picture than what we're seeing from the world economy."
In other commodities, August gold bullion added 10 cents to US$1,274.10 an ounce, while July copper advanced a penny to US$3.03 a pound.
There was also a major acquisition deal for traders to digest as Montreal's Amaya Gaming Group Inc. (TSX:AYA) announced it was buying the company that owns PokerStars and Full Tilt Poker for US$4.9 billion in an all-cash deal.
The acquisition of the Oldford Group, parent company of the Rational Group Ltd., will create the world's largest publicly traded online gaming company, it says. Online poker platforms PokerStars and Full Tilt Poker are globally popular brands with more than 85 million registered players on desktop and mobile devices. Shares in Amaya gained nearly 42 per cent, or $5.87, to close at $19.95 on the Toronto Stock Exchange
Follow @LindaNguyenTO on Twitter.
Note to readers: This is a corrected story. An earlier version had an incorrect Canadian dollar figure.
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