WIN: TSX posts small gain on strong earnings from RIM; gold continues to climb
TORONTO - The Toronto stock market moved higher in early trading Friday, bolstered by a strong technology sector after tech heavyweight Research in Motion reported record quarterly earnings.
The S&P/TSX composite index added 20.78 points to 12,194.14, while the TSX Venture Exchange gained 13.99 points to 1,664.32.
The tech sector added one per cent after RIM (TSX:RIM) reported a record US$796.7 million profit in its most recent quarter, up 68 per cent from a year ago, while revenue increased 31 per cent.
The BlackBerry maker also said it expects to resolve its security concerns with countries such as the United Arab Emirates and India, which want access to encrypted data on BlackBerrys — a demand that threatens to undermine RIM's reputation for highly secure communications.
Shares in RIM gained $1.40 or three per cent to $49.10.
The gold sector added one per cent as the December bullion contract on the New York Mercantile Exchange jumped $6.40 to US$1,280.20 an ounce. The price of the precious metal has been soaring in recent days, and appears set to close at another record high — its third this week.
Shares in Barrick Gold Corp. (TSX:ABX) gained 92 cents to C$48.04.
The metals and mining sector gained one per cent as the December copper contract added four cents to US$3.54 a pound. Shares in HudBay Minerals Inc. (TSX:HBM) rose 23 cents to C$15.37.
The energy sector edged up 0.3 per cent as the October crude contract slipped 17 cents to US$74.40 a barrel. Shares in Suncor Energy Inc. (TSX:SU) added 26 cents to C$33.30.
The financial sector was flat. Shares in CIBC (TSX:CM) fell 23 cents to $73.78.
The Canadian dollar slipped 0.19 of a cent to 97.22 cents US.
In New York, stocks moved higher on strength in the tech sector following RIM's better-than-expected results and strong profits from software company Oracle Corp. (Nasdaq:ORCL). Oracle's strong revenue growth demonstrated that companies are investing in new technology — often considered a leading indicator for an economic recovery.
The Dow Jones industrial average added 22.33 points to 10,617.16. The Nasdaq composite index was up 7.39 points at 2,310.64, while the S&P 500 gained 3.34 points to 1,128.00.
A report that U.S. consumer prices posted a small rise of 0.3 per cent in August had little impact on the markets. Outside of a big jump in volatile gasoline prices, inflation was essentially flat, the Labour Department reported.
The recession and the weak recovery have banished inflation as an immediate threat. Sluggish demand is preventing most businesses from raising prices and high unemployment is keeping a lid on wage pressures.
A report on U.S. consumer sentiment could also affect markets. Rising consumer confidence would bode well for the market because it could mean a jump in retail sales, a primary driver of the economy.
In economic news, the Organization for Economic Co-operation and Development said the global economy is off to a weaker start in the second half than expected. Earlier this month, the Paris-based organization predicted the Group of Seven industrialized countries will grow by around 1.5 per cent on an annualized basis in the second half of 2010 — down from its previous forecast of 1.75 per cent in May.
In corporate news, Casey's General Stores Inc. (Nasdaq:CASY) said two more proxy advisory firms have recommended that Casey's shareholders vote for the company's eight board nominees instead of the slate that Canadian suitor Alimentation Couche-Tard Inc. (TSX:ATD.B) wants to elect. This brings the total of proxy advisory firms supporting Casey's nominees to four. Shares in Couche-Tard added 34 cents to $23.25.
And China-based Jinchuan Group Ltd. has reached a friendly deal to acquire junior miner Continental Minerals Corp. (TSXV:KMK) for $432 million in cash. Shares in Continental jumped 30 cents or 13 per cent to $2.60.
Overseas markets were flat. Britain's FTSE 100 rose 0.01 per cent, Germany's DAX index fell 0.19 per cent, and France's CAC-40 climbed 0.22 per cent. Japan's Nikkei stock average rose 1.2 per cent while Hong Kong's Hang Seng index added 1.3 per cent.
