News Column

TSX springs to life

July 16, 2014



Bank rate announcement made







The S&P/TSX composite index rocketed 111.61 points to open at 15,192.23.

The Canadian dollar dipped 0.16 cents to 92.79 cents U.S.

Bombardier reached the 500 mark for deals for its Q400 turboprop model and for its CSeries airliner with three contracts announced at the Farnborough Airshow. Bombardier gained 2.5 cents to $3.82.

A Canadian regulator said on Tuesday it had delayed a decision on Kinder Morgan Energy Partner's Trans Mountain expansion project by about six months to January 2016, after requesting additional information from the pipeline company on changes to a small portion of the route. Kinder Morgan shares gained 13.5 cents U.S. in New York to $36.31.

Russia's Severstal has agreed to sell Pennsylvania-based metallurgical coal producer PBS Coals to Canada's Corsa Coal Corp for an enterprise value of $140 million, that word from the Russian company on Tuesday. Corsa shares gained three cents to 16.5 cents.

CIBC raised the price target on Alimentation Couche-Tard to $35 from $34, with a sector perform rating. Couche-Tard shares took on 18 cents to $29.29.

The Bank of Canada today announced that it is standing pat on its overnight rate at 1%. The bank rate is 1.25% and the deposit rate is 0.75%

Elsewhere on the economic front, Statistics Canada reported this morning that manufacturing sales rose 1.6% to $51.6 billion in May, the fourth increase in five months.

ON BAYSTREET

The TSX Venture Exchange regained 3.38 points to 1,009.95.

All but one of the 14 Toronto subgroups were higher, with global base metals ahead 1.7%, metals and mining up 1.5%, and gold up 1.4%.

The lone laggard was information technology, down 0.2%.

ON WALLSTREET

Worries over a possible bubble in biotech and social media stocks quickly faded, sending U.S. stocks to record highs at Wednesday's opening bell.

The Dow Jones Industrials moved forward 52.18 points to yet another all-time high of 17,112.86

The S&P 500 recovered 6.91 points to 1,980.19, and the NASDAQ composite bolted higher 23.31 points to 4,439.70

Time Warner shares surged almost 16% after the owner of HBO and CNNMoney confirmed it received and rejected a takeover offer from Murdoch's 21st Century Fox.

So far, Time Warner has rebuffed the buyout, but the news drove up prices of other media stocks, including Discovery Communication, CBS Corp, Comcast and Walt Disney Co

In the tech world, shares of both IBM and Apple floated higher after they announced they would join forces to offer iPhones and iPads preloaded with special software developed by IBM. The alliance drove down shares of BlackBerry by almost 5%.

While investors decipher mixed messages from the Federal Reserve and the economy, earnings continue to largely impress.

Intel Corp rose nearly 6% after the chip maker posted earnings that beat expectations and announced plans to boost its share repurchase program by $20 billion U.S. Intel is now the top performing stock in the Dow for 2014.

Textron Inc gained altitude, rising 4% on the Cessna maker's higher profits and jumping revenue.

Abbott Lab ticked higher after the company boosted its outlook for the year and reporting second-quarter earnings that impressed investors.

Unlike many of its rivals, Bank of America Corp fell 2% after reporting a big drop in second-quarter earnings. While its profits exceeded expectations, BofA disclosed a $4-billion U.S. legal charge, showing the bank continues to be dogged by legal headaches.

Speaking of headaches, Yahoo slid 4% in the wake of reporting second quarter revenue and profits that missed forecasts. PNC dropped 4% after reporting a slight drop in profits and revenue.

After the closing bell, e-commerce giant eBay Inc is scheduled to hit the earnings stage.

The world's second biggest economy grew by 7.5% compared with the same period last year, despite continued worries about a slowdown in real estate. It was the first time the economy has accelerated in three quarters, putting China on a somewhat better footing to reach its official growth target of 7.5% for 2014.

Investors focused on a number of positives, including stronger growth in China, a string of upbeat earnings reports and M&A chatter about the media sector.

Prices for 10-year U.S. Treasuries lowered, raised yields to 2.56% from Tuesday's 2.55%. Treasury prices and yields move in opposite directions.

Oil prices gained 85 cents to $100.81 U.S. a barrel.

Gold prices added $5.70 to $1,302.80 U.S. an ounce.


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Source: Baystreet Stock Market Update (Canada)


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