A day of ups and downs on the Toronto Stock Exchange Tuesday ended with its first gain in three sessions, largely on the strength of commodity stocks.
The S&P/TSX composite index closed up 86.41 points, or 0.75%, to 11,629.88, with materials and energy stocks leading the gains.
The junior TSX Venture composite was up 1.10 point, or 0.08%, to 1,363.20.
On the New York Mercantile Exchange gold, seen as a safe-haven investment as concerns mounted about the strength of economic recovery in industrialized countries, was up US$9.80 to US$1,191.70 an ounce.
Other commodities rose along with speculation China will back away from measures it has taken to cool down its housing market. This included crude oil, up US61¢ to US$77.15 a barrel in New York.
Another positive event for Bay Street investors were preliminary second-quarter results from Air Canada that were better than expected. Its stock closed up 12.57% at $2.15 on the TSX.
Other market movers included Bombardier Inc. (up 4.97% to $4.65), Teck Resources Ltd. (up 3.69% to $34.31), Suncor Energy Inc. (up 1.78% to $33.13) and New Gold Inc. (up 4.79% to $5.25).
The Canadian dollar rose 92 basis points to US95.71¢.
Markets in Canada and the U.S. were negative at times Tuesday as U.S. housing starts came in less than expected and some disappointing quarterly results came from companies such as IBM, Goldman Sachs and Texas Instruments.
But markets south of the border also turned positive by day's end. The Dow Jones industrial average was up 75.53 points, or 0.74%, to 10,229.96. The Nasdaq composite index gained 24.26 points, or 1.10%, to 2,222.49.
Most European and Asian markets were down, except in Hong Kong where the Hang Seng index was up 0.86%.
BMO Capital Markets economist Robert Kavcic credited earnings from the U.S. that are, for the most part, meeting or beating expectations for pushing North American stock markets to positive endings on Tuesday.
Still, he acknowledged that the investor response to second-quarter earnings so far has been less than resounding. Kavcic said this is largely because of the fact that while profits are mostly meeting the bar set for them, revenues are not doing so to the same degree. This is indicative of an earnings growth derived from cost-cutting rather than increased economic activity.
"That's fine very early in (a recovery from recession)," Kavcic said. "But I think we're at a point in the cycle now where the market really wants to see demand growth driving earnings as opposed to cost cuts driving earnings."
