Canadian dollars or "loonies" are shown with U.S dollars in this April 6, 2010 photo. THE CANADIAN PRESS/Ryan Remiorz
TORONTO - The Toronto stock market advanced Monday with financials leading the way following a solid earnings report from American bank Citigroup.
The S&P/TSX composite index was 25.6 points higher to 12,634.6 while the TSX Venture Exchange gained 8.61 points to 1,831.14.
The Canadian dollar was down 0.22 of a cent to 98.61 cents US.
The loonie weakened as a stronger greenback recouped some recent losses amid ongoing uncertainties about how much new money the Federal Reserve is preparing to pump into the U.S. economy as part of another round of quantitative easing which is expected to be announced early next month.
The TSX financial sector was up 0.43 per cent as Citigroup Inc. reported that quarterly profit rose to US$2.17 billion as provisions for bad loans declined. Net income amounted to seven cents a share, which beat analysts' estimates by two cents and its shares were up 14 cents to US$4.09 in New York.
“Certainly some good news out of the financials tends to be good news on both sides of the border,” said Kate Warne, Canadian markets specialist at Edward Jones in St. Louis.
Investors also took in some major buying activity in the financial sector. Royal Bank of Canada (TSX:RY) is acquiring British-based BlueBay Asset Management for more than $1.5 billion. BlueBay shareholders will be entitled to 485 pence in cash for each BlueBay share, a premium of 29 per cent over the last closing price of BlueBay shares last Friday.
The transaction will be funded using RBC’s existing cash resources, and is not expected to have a material impact on RBC’s earnings per share in the near term and Royal Bank stock was up 40 cents to C$55.95.
Elsewhere in the sector, CIBC (TSX:CM) climbed 95 cents to $78.22.
Telecoms were also higher with Rogers Communications (TSX:RCI.B) ahead 65 cents to $40.50.
Energy stocks advanced as oil prices recovered some ground after two days of losses with the November crude contract on the New York Mercantile Exchange $1.53 higher to US$82.78 a barrel. Nexen Inc. (TSX:NXY) rose 14 cents to C$22.54 while Talisman Energy (TSX:TLM) climbed 14 cents to $18.13.
The base metals sector was the leading decliner, down almost one per cent as the December copper contract on the Nymex rose a penny at US$3.85 a pound. Teck Resources (TSX:RCI.B) stepped back 75 cents to C$45.26.
