TORONTO (Reuters) - Canada’s main stock index ended sharply higher on Wednesday, as Apple Inc’s blowout earnings boosted investor confidence, while the U.S. Federal Reserve reiterated its expectation that interest rates would not rise until late 2014 at the earliest.
Fed Chairman Ben Bernanke said the U.S. central bank “would not hesitate” to launch another round of bond purchases to drive borrowing costs lower if it looked like the economy needed it, triggering many riskier assets to extend gains.
Nearly all of Canada’s 10 main sectors were higher, led by weighty resource shares.
Key gainers included Potash Corp (POT.TO), up nearly 4 percent to C$43.65, Canadian Natural Resources (CNQ.TO), up 3.4 percent to C$32.37, and Canadian National Railway (CNR.TO), 1.9 percent higher at C$82.79.
“Anybody who didn’t think that Ben Bernanke was going to say what Ben Bernanke was going to say hasn’t been listening,” said Fred Ketchen, director of equity trading at Scotia McLeod.
“Interest rates aren’t going anywhere anytime soon. They still have hurdles to overcome in the United States, they’re working away at it, but he says he’ll do what he needs to do. I‘m not ready to give up on him.”
Bernanke also said the U.S. central bank “would not hesitate” to launch another round of bond purchases to drive borrowing costs lower if it looked like the economy needed it.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended up 130.96 points, or 1.1 percent, to 12,111.06.
On Wall Street, Apple’s (AAPL.O) forecast-beating results removed a weeks-old market overhang and lifted optimism in a corporate earnings season that is already far outstripping expectations. About 75 percent of the 200 companies in the S&P 500 that have reported results so far have beat expectations, a rate that is above the norm. .N
“The response from Canada is a little more muted, given the fact we don’t really have a (significant) tech sector,” said Paul Hand, managing director at RBC Capital Markets.
Weighing on the TSX was a weaker-than-expected earnings report on Tuesday from Canada’s largest mobile phone company, Rogers Communications Inc (RCIb.TO). Rogers shares fell nearly 6 percent to C$36.81 after it reported a 16 percent decline in quarterly profit as rising competition hurt its cable and wireless divisions.
Editing by Leslie Adler