The Toronto stock market held onto a solid gain at mid-morning Thursday following a batch of upbeat earnings from key resource companies.
The S&P/TSX composite index gained 60.28 points to 11,756.92.
Suncor Energy Inc. (TSX:SU), Barrick Gold Corp. (TSX:ABX), Goldcorp Inc. (TSX:G), and Potash Corp. of Saskatchewan Inc. (TSX:POT) all reported big jumps in second-quarter income and revenue, which boosted their stock prices.
The Toronto energy sector gained 0.4 per cent after Canada’s biggest oil producer reported a huge reversal in its second-quarter fortunes. Suncor Energy saw a profit of $480 million compared to a loss of $51 million a year ago. Shares in Suncor added 62 cents to $33.66.
The September crude contract on the New York Mercantile Exchange gained $1.35 to US$78.34 a barrel.
Gold stocks added 0.6 per cent after Canada’s two largest gold companies reported huge gains in quarterly profits.
Barrick Gold Corp., the world’s largest gold producer, raised its dividend 20 per cent as it reported a record second-quarter profit of US$783 million, up 59 per cent from a year ago. Shares in Barrick gained 43 cents to C$42.05.
And Goldcorp Inc. reported a second-quarter profit of US$826.7 million, boosted by the sale of its Escobal silver deposit in Guatemala. This compared with a loss of $232.4 million in the same period last year. Shares in Goldcorp gained one cent to $40.46.
The August bullion contract edged up $3.50 to US$1,163.90 an ounce.
Financial stocks were the biggest gainer at mid-morning Thursday, adding 1.1 per cent after Moody’s Investors Service said ratings on banks in Europe would not be affected following tests by regulators to determine whether banks would survive a further economic slowdown. Only seven of 91 banks failed the test, providing assurances that the financial sector in Europe is stronger than previously thought. Shares in Bank of Montreal (TSX:BMO) gained 29 cents to $62.86.
The base metals sector added 0.8 per cent as the September copper contract climbed 3.9 cents to US$3.28 a pound. Shares in HudBay Minerals Inc. (TSX:HBM) gained 43 cents or 3.3 per cent to C$13.30.
The loonie was up 0.5 cent to 96.79 cents US. The TSX Venture exchange added 3.76 points to 1,414.38.
Better-than-expected earnings from companies like Southwest Airlines Co., ExxonMobil Corp., Avon Products Inc. and Sony Corp. boosted Wall Street.
The Dow Jones industrial average gained 31.56 points to 10,529.44, while the Nasdaq composite index was up 0.66 of a point at 2,274.73. The S&P 500 index added 2.61 points to 1,108.74.
American markets were also buoyed by a slightly better-than-expected drop in U.S. unemployment claims, which signals the pace of recovery is picking up again.
The U.S. Labor Department said initial jobless claims fell to 457,000 last week. That’s better than the 459,000 forecast by economists.
Economic reports in recent months have largely pointed to a slowdown in growth, countering the optimism seen by company executives. Analysts widely agree that new hiring would spark a stronger recovery by boosting consumer confidence and driving retail sales higher.
Thursday was a busy day for Canadian companies reporting second-quarter results.
Potash Corp. of Saskatchewan Inc. said it earned $472 million, more than double the $186.2 million profit it saw in the same period last year, and raised its profit outlook for the year. This is the second-highest second-quarter total in the company’s history. Shares in Potash Corp. gained $1.43 to $103.13.
Agnico-Eagle Mines Ltd. (TSX:AEM) said its quarterly profit soared to US$100.4 million from $1.2 million a year earlier as the gold miner had all six of its mines in production. Shares in the company were unchanged C$57.27.
Cenovus Energy Inc. (TSX:CVE), the integrated oil company spun off last year by Encana Corp. (TSX:ECA), said it earned $172 million in the second quarter, up 7.5 per cent, but missed analysts’ expectations. Shares in Cenovus lost $1.14 or 3.8 per cent to $28.83.
Transportation company TransForce Inc. (TSX:TFI) said its net income fell by five per cent to $17 million while revenue gained nine per cent compared with last year. Shares in the company gained 47 cents or five per cent to $9.80.
Information services provider Thomson Reuters Corp. (TSX:TRI) said profit dropped eight per cent to US$290 million while revenue slipped two per cent. Shares in Thomson Reuters lost 43 cents to $39.27.
European markets were higher following strong earnings from companies including AstraZeneca PLC and Bayer AG. Britain’s FTSE 100 rose 0.7 per cent, Germany’s DAX index rose 0.6 per cent, and France’s CAC-40 gained 0.6 per cent. Japan’s Nikkei stock average fell 0.6 per cent while Hong Kong’s Hang Seng index was flat.
