January 16, 2014 / 2:48 PM / in 4 years

Economic data propels TSX to 2-1/2-year high

TORONTO (Reuters) - Canada’s main stock index advanced to its highest in 2-1/2 years on Thursday after upbeat data from the United States, Europe and Japan suggested strength in the global economic recovery, driving gains in almost every major sector.

A Toronto Stock Exchange (TSX) logo is seen in Toronto November 9, 2007. REUTERS/Mark Blinch

Investors tracked a report showing that the number of Americans filing new claims for unemployment benefits dropped for a second week last week, while separate data showed U.S. consumer prices posted their biggest gain in six months in December.

European car sales in December gained the most in four years, an industrial group said. In Japan, core machinery orders shot up to a five-year high in November.

Partly offsetting the mood, Bombardier Inc BBDb.TO dropped 7.7 percent after the plane maker said it will delay putting its new narrow-body CSeries jet into commercial service by at least nine months, citing a longer-than-expected test phase.

After recording a 9.6 percent gain in 2013, the Toronto Stock Exchange’s benchmark index is up about 1.5 percent this year.

Investors said the Toronto market, which has gained in seven of the last eight sessions, was starting to benefit from a rotation of funds from bonds to equities.

“There’s been a swing in money flow over the last 12 months that is gaining momentum,” said Julie Brough, vice president at Morgan Meighen & Associates.

“People frustrated by the fact that last year their bond funds either didn’t make any money or lost money are trying to overcome their fear of equity markets,” she added.

The Toronto benchmark S&P/TSX composite index .GSPTSE closed up 59 points, or 0.43 percent, at 13,831.58, its strongest level since mid-2011.

“I‘m generally positive on the TSX,” said Colin Cieszynski, senior market analyst at CMC Markets Canada. “If we start to see the global economy improve, and demand for resources improve, that could certainly help Canada.”

Nine of the 10 main sectors on the index were higher on Thursday.

Financials, the index’s most heavily weighted sector, added 0.2 percent. Royal Bank of Canada RY.TO advanced 0.4 percent to C$71.36, and Toronto-Dominion Bank TD.TO climbed 0.2 percent to C$97.81.

The materials sector, which includes mining stocks, rose 1 percent, with Teck Resources Ltd TCKb.TO jumping 4.4 percent to C$28.51.

In corporate news, Australia’s Bega Cheese Ltd BGA.AX said it will sell its 18.8 percent stake in Warrnambool Cheese and Butter Factory Co Holdings Ltd WCB.AX to Saputo Inc SAP.TO, which has been seeking control of Warrnambool. The news drove Saputo shares up 1.5 percent to C$51.68.

($1=$1.09 Canadian)

Editing by Peter Galloway

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below