TSX closes higher amid worse than expected economic data from eurozone
TORONTO - The Toronto stock market closed slightly higher Thursday amid dismal economic data from Europe.
The S&P/TSX composite index climbed 28.45 points to 15,291.18, held back by losses in energy and mining stocks.
The Canadian dollar was up 0.12 of a cent to 91.72 cents US.
U.S. indexes also advanced as Wal-Mart cut its annual profit forecast, with the Dow Jones industrials ahead 61.78 points at 16,713.58, the Nasdaq up 18.87 points at 4,453, and the S&P 500 index climbing 8.46 points to 1,955.18.
There was grim news from the eurozone as Germanyâ€™s economy, the regionâ€™s biggest, shrank by a quarterly rate of 0.2 per cent, held back by weaker investment by business and by fears over the crisis in Ukraine.
"It reaffirms we arenâ€™t out of the woods yet," said Tim Caulfield, co-lead manager of Franklin Bissett Canadian Equity Fund, adding this means that the European Central Bank is more likely to step up with further stimulus.
France, the regionâ€™s second-largest economy, showed zero growth for the second straight quarter. Third-ranked Italy shrank.
Ukraine fears have only grown since the end of the quarter on June 30, particularly after a Malaysian airliner was shot down in mid-July by a missile in eastern Ukraine.
Markets seemed reassured by comments from Russian President Vladimir Putin, who said Russiaâ€™s goal was "to stop bloodshed in Ukraine as soon as possible."
His comment came as a large Russian aid convoy resumed its journey toward Ukraine on Thursday, taking a road leading directly toward a border crossing controlled by pro-Russian rebels.
Moscow has insisted it co-ordinated the dispatch of the goods with the International Red Cross. But the Red Cross was unable to confirm where the convoy was headed.
Sentiment picked up in the final minutes of the session after Iraqi state TV reported that Nouri al-Maliki has given up the post of prime minister to Haider al-Abadi, who was tasked with forming a new government earlier this week by Iraqâ€™s president.
Despite the geopolitical anxieties, markets have proved resilient this month amid a steady stream of positive Canadian earnings news.
"In Canada, thatâ€™s been a very good news story to date," Caulfield said.
"Second-quarter earnings per share is coming in approximately at a 20 per cent increase versus the second quarter of 2013. We're generally seeing companies beat expectations (and) the expectation is still there for mid-teens growth in earnings for 2014 as a whole," he said.
The financials and industrials groups led TSX advancers.
The base metal sector led decliners, down 1.76 per cent with September copper down two cents at US$3.10 a pound.
The energy sector lost 0.94 per cent, while September crude in New York declined $2.01 to US$95.58 a barrel, reflecting Wednesday's data showing a surprise hike in U.S. inventories last week and the weak European growth data.
The gold sector lost about one per cent as December bullion rose $1.20 to US$1,315.70 an ounce.
Iamgold Corp. (TSX:IMG) reported a US$16-million net loss and $8.8 million in adjusted earnings for the second quarter. The adjusted earnings, reported in U.S. currency, amounted to two cents per share, a penny below analyst estimates. Its shares rose 13 cents to $4.33.
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