News Column

Record for TSX

August 26, 2014

Tim Horton-Burger King in focus

Equities in Canada's largest market hit a record high on Tuesday as shares of Tim Hortons extended their rally, after the coffee chain said it planned to merge with Burger King Worldwide Inc in a $12.64-billion deal.

The S&P/TSX composite index was up 20.47 points to finish Tuesday at 15,619.21. The benchmark TSX has climbed nearly 15% this year.

The Canadian dollar was up 0.28 cents at 91.33 cents U.S.

The companies said the cash-and-stock agreement would create the world's third-largest fast-food restaurant group, with roughly $23 billion in combined annual sales.

Tim Hortons shares jumped 8.1% to $88.71 -- a multi-year high -- and was one of the most heavily traded stocks on exchange. In the previous session, the stock shot up more than 19%.

The Toronto market received further support from shares of energy companies, which benefited from gains in the price of oil, and from gold stocks, whose gains topped all the subgroups.

Shares of Suncor Energy settled 0.3% to $44.16, but Canadian Natural Resources leaped 1.2% to $47.16.

Barrick Gold leaped 1% to $19.95, while Allied Nevada Gold popped 6.3% to $3.87.

Financials slipped slightly after two of Canada's major banks reported


Bank of Montreal gained 0.4%, to $82.16, after the company reported a stronger-than-expected third-quarter profit, helped by gains at its Canadian and U.S. personal and commercial banking units and higher revenue at its capital markets arm.

But Bank of Nova Scotia gave back 2% to $72.68 after the lender reported quarterly results.


The TSX Venture Exchange gained 7.12 points to 1,015.36

All but three of the 14 Toronto subgroups were higher, led by gold, up 1.8%, materials, better by 1.1%, and the metals and mining group, improving 0.8%.

The three laggards were financials, down 0.5%, utilities, down 0.2%, and industrials, off 0.1%.


U.S. stocks edged higher Tuesday, with the S&P 500 notching its first-ever finish above the milestone level of 2,000.

The Dow Jones Industrials improved 29.83 points to end Tuesday at 17,106.70

The S&P 500 gained 2.10 points to 2,000.02. The NASDAQ added 13.29 points to 4,570.64.

Best Buy Co. shares closed down 6.8% amid a sluggish outlook. The struggling retailer was the day's worst performer in the S&P 500.

Burger King Worldwide and Tim Hortons confirmed Tuesday that they plan to combine to create a new company in an $11-billion U.S. deal. They are getting financing help from Warren Buffett's Berkshire Hathaway.

Burger King shares lost 4.3% after surging Monday, while Tim Hortons' U.S.-listed shares gained 8.5%.

Shares of Kite Pharma Inc. rose 17.7% after the biotech reported the majority of patients responded positively to its cancer-drug candidate.

Economically speaking, orders for U.S. durable goods skyrocketed a record 22.6% in July because of a surge in contracts for Boeing Co. aircraft, but bookings actually fell for most other industries, the Commerce Department reported.

Meanwhile, an August reading on consumer confidence came in at 92.4, above forecasts for 88.5, and U.S. home prices rose 1% in June.

Prices for 10-year U.S. Treasuries moved down, raising yields back to Monday's 2.39%. Treasury prices and yields move in opposite directions.

Oil prices were up 51 cents to $93.86 U.S. a barrel.

Gold prices picked up $4.60 to $1,283.50 U.S. an ounce.

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Source: Baystreet Stock Market Update (Canada)

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