News Column

TSX rides miners to gains

May 12, 2014



Pfizer in vogue







Rising miners helped give the Toronto stock market a solid gain as copper prices jumped in response to moves to open up Chinese markets.

The S&P/TSX composite index gained 76.78 points to greet noon at 14,610.84

The Canadian dollar poked ahead 0.09 cents to 91.83 cents U.S.

Base metal miners advanced after China's cabinet promised in an announcement late Friday to allow local governments to issue bonds and to streamline the approval process for initial public stock offerings, a move that was seen as widening market access.

On the merger and acquisition front, Botox-maker Allergan has rejected the $48-billion U.S. hostile takeover bid by Quebec-based Valeant Pharmaceuticals International, Inc

It says the bid undervalues Allergan, isn't in the best interests of the U.S. company and creates risks and uncertainties for its shareholders. The California-based company also says the offer doesn't reflect its future earnings and growth. Valeant shares dropped $2.27 to $140.69.

In other corporate news, Chemtrade Logistics Income Fund says it has an agreement to sell its refinery services business in Montreal to Suncor Energy Products Inc. for roughly $120 million.

Chemtrade's Montreal business provides sulphur removal and other services only to Suncor'sMontreal refinery. Chemtrade units were unchanged from Friday at $20.60.

ON BAYSTREET

The TSX Venture Exchange faded 3.54 points to 987.56

All but one of the 14 Toronto subgroups were in the green midday, with metals and mining spiking 3.3%, global base metals stronger by 3.1%, and materials gaining 1.6%.

The lone holdout was utilities, off 0.2%.

ON WALLSTREET

Major indices jumped in Monday morning trading

The Dow Jones Industrial Average screamed ahead 101.85 points to break for lunch at 16,685.19

The S&P 500 gained 15.23 points to 1,893.71, and the NASDAQ composite index soared 59.90 points to 4,131.77

While investors have continued pouring into the perceived safety of blue chip companies, tech stocks have been hammered as investors fret about sky-high valuations and in some cases not-yet-proven business models.

There was also a bit of that merger Monday feeling in the air, after Hillshire Brands announced plans to acquire packaged foods company Pinnacle Foods for $6.6 billion U.S. Shares of Pinnacle surged 15% on the news, while shares of Hillshire dropped 6%.

Investors are also on the lookout for another mega health-care deal, of which there have been aplenty so far this year.

Pfizer shares rose after the company published a letter to a parliamentary committee in the United Kingdom arguing its case for its proposed $106 billion U.S. acquisition of AstraZeneca.

The chief executives of both companies will be grilled by British lawmakers Tuesday and Wednesday, reflecting high levels of public anxiety over the impact of a takeover on jobs and scientific research in the U.K.

So far the two health care giants have been unable to reach an agreement, but if completed, the deal would likely be the second biggest pharmaceutical deal after Pfizer's $112 billion U.S. purchase of Warner Lambert in 2000.

GoGo soared after the company beat earnings estimates. The inflight internet provider reported a narrower loss compared to a year earlier and said that its revenue climbed 35%.

Ralph Lauren suffered after the iconic clothing company's stock was hit with an analyst downgrade. The stock has been sliding and is down more than 16.5% this year as it struggles to keep up with the competition.

Twitter was slowly crawling back Monday. The stock is down 15% in the past five trading sessions, a victim of the broader sell-off in various tech names, but it is trading solidly above $30 U.S. again.

Prices for 10-year U.S. Treasuries stepped back, lifting yields to 2.65% from Friday's 2.62%. Treasury prices and yields move in opposite directions

Oil prices took on 65 cents to $100.64 U.S. a barrel.

Gold prices gained $10.90 to $1,298.50 U.S. an ounce.


For more stories on investments and markets, please see HispanicBusiness' Finance Channel



Source: Baystreet Stock Market Update (Canada)


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