TORONTO (Reuters) - Canada’s main stock index advanced on Thursday, boosted by stronger financial stocks and a move by telecoms company Telus Corp (T.TO) to acquire a smaller wireless carrier.
Telus said it will pay C$380 million ($370 million) for Mobilicity, whose recent entry into the industry helped force prices down, even though the debt-laden company failed to draw many customers.
The index’s gains were kept in check by sluggish economic data from Europe and the United States, which weighed on the prices of some commodities.
Data showed U.S. jobless claims rose sharply last week and ground-breaking at home construction sites tumbled in April. In Europe, falling prices in Germany and France pulled euro zone consumer inflation to a three-year low in April, while imports fell 10 percent in March.
“The markets have taken (the data) with a grain of salt and continued to grind higher,” said Youssef Zohny, portfolio manager at Stenner Investment Partners, a unit of Richardson GMP.
“We are in a tug-of-war,” he added. “We’re seeing weaker-than-expected economic data, which is being counteracted by monetary stimulus around the world.”
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed up 33.95 points, or 0.27 percent, at 12,507.60.
“The mood is caution,” said Fred Ketchen, director of equity trading at ScotiaMcLeod. “The strength is coming in areas where people are looking for income and dividends.”
He said sectors such as utilities, telecoms, and financials were drawing the greatest interest from investors.
Seven of the 10 main sectors on the index were higher. Financials, the index’s most heavily weighted sector, added 0.3 percent.
The materials sector, which includes mining stocks, was up 0.5 percent. In the group, fertilizer producer Potash Corp POT.TO rose 1.3 percent to C$44.67 and played the biggest role of any single stock in leading the index higher after announcing a dividend increase on Wednesday.
A rise in the price of oil helped energy shares climb 0.2 percent, while industrials rose 1.2 percent.
Telus shares gained 1.1 percent to C$37.34. They are up about 5 percent since completing a two-for-one stock split on April 17.
Editing by Kenneth Barry; Editing by Peter Galloway