TSX rebounds as financials climb, Inmet leaps
By Claire Sibonney
TORONTO (Reuters) - Canadian stocks recovered from a one-week low to end higher on Wednesday, led by financial shares on expectations of healthy bank earnings and by Inmet Mining Corp IMN.TO, which jumped 18 percent after it turned down a hostile takeover bid.
The base metals miner, which turned down the unsolicited offer from larger competitor First Quantum Minerals FM.TO, whose shares were down 1.6 percent, also said it had adopted a shareholder rights plan, which will allow it time to consider other bids or to seek alternatives to a takeover.
"I think, hopefully, Inmet shareholders will see some of the big boys come in and look to top the bid. We'll see," said Barry Schwartz, portfolio manager at Baskin Financial Services, who owns Inmet stock.
The late-day rebound on the index also followed comments from a top Republican that fueled hopes for a U.S. budget deal that would avert the "fiscal cliff" of tax hikes and spending cuts that threatens to drag the United States back into recession.
U.S. House of Representative Speaker John Boehner said Republicans were willing to put revenues on the table to get a U.S. fiscal deal if Democrats agreed to spending cuts. President Barack Obama, speaking later in the day, said he hoped to get a deal done in the next four weeks.
"The market is fixated on the perception of which way the talks on the fiscal cliff are going. That's the single biggest driver," said Elvis Picardo, strategist and vice president of research at Global Securities.
"The underlying tone of the market is positive. There is hope that some resolution will be achieved. Barring any macroeconomic shocks, we're looking for a positive close for the end of the year," Picardo said of the outlook for the TSX.
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended up 28.70 points, or 0.24 percent, at 12,140.33. The TSX is up about 1.5 percent since the start of the year. Continued...