News Column

TSX holds onto gains at noon

September 3, 2014



Staples spike, energy down







Canada's main stock index rose on Wednesday, boosted by news of a ceasefire agreement between Ukraine and Russia and a rebound in Chinese economic data.


The S&P/TSX composite index remained ahead 5.76 points to greet noon at 15,624.84.

The Canadian dollar gained back 0.46 to 91.97 cents U.S.

The energy sector has gained roughly 17% so far this year as investors bought into undervalued stocks.


Experts have said valuations were still on the low end of fair value for many oil and gas names, including Suncor Energy, which was up 0.6% at $43.91.


Elsewhere, Alimentation Couche-Tard jumped 4.1% to $34.60 after the convenience store and gas station operator posted solid results and said it had agreed to sell its aviation fuel business.


At the other end of the spectrum, Canexus Corp shares fell 9.9% to $4.82 after the chemical company said it was suing MEG Energy Corp for refusing it access to a pipeline.


Analysts at CIBC called the development a “nightmare” in a note to clients. MEG was up 0.7% at $38.31.

Economically speaking, the Bank of Canada today announced that it is maintaining its target for the overnight rate at 1%. The Bank Rate is correspondingly 1 ¼% and the deposit rate is ¾%.

ON BAYSTREET

The TSX Venture Exchange reversed itself and lost 1.35 points to 1,009.53.

The 14 Toronto subgroups were evenly split between gainers and losers, as consumer staples gathered 1.3%, information technology improved 0.9%, and metals and mining grew 0.8%.

The seven laggards were weighed mostly by energy stocks, fading 0.4%, while gold and consumer discretionary stocks each backed off 0.2%.

ON WALLSTREET

U.S. stocks were mixed on Wednesday, despite optimism a resolution would be reached between Ukraine and Russia and data showing manufacturing activity continues to strengthen.

The Dow Jones Industrials maintained gains of 30.66 points to 17,098.22

The S&P 500 dipped 0.80 points to 2,001.48. The NASDAQ slid 23.31 points to 4,574.88.

August auto sales were unexpectedly strong, led by Ford Motor, Chrysler Group and Nissan Motor, which easily beat analysts' estimates as the industry is seen reaching volumes not seen since before the recession. Ford shares edged up 0.1% to $17.62 U.S. while General Motors slipped 0.4% to $34.66 U.S.

Housing stocks were a weak spot, weighed down by a 2.8% decline in Toll Brothers to $34.67 U.S. after the largest U.S. luxury homebuilder posted quarterly results.

On the economic front, Data continued to point to an improving U.S. economy. New orders for manufactured goods increased a record 10.5% in July. June's orders were revised to show a 1.5% increase instead of the previously reported 1.1% rise.

The Fed Beige Book is due at 2 p.m. Eastern Time —all serving as a prelude to the key non-farm-payrolls report on Friday.

Prices for 10-year U.S. Treasuries sagged, raising yields to 2.43% from Tuesday's 2.42%. Treasury prices and yields move in opposite directions.

Oil prices spiked $1.50 to $94.38 U.S. a barrel.

Gold prices added $1.50 to $1,268.40 U.S. an ounce.


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Source: Baystreet Stock Market Update (Canada)


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