Friday, May 13, 2011

Toronto stock market outlook may 13 2011, Mining stocks push TSX higher

Toronto stock market outlook may 13 2011 Mining stocks push TSX higher : The Toronto stock market was slightly higher Friday after strong economic data from Europe encouraged investors to pick up mining stocks at the end of a negative week.

The S&P/TSX composite index gained 22.97 points to 13,412.39 while the TSX Venture Exchange was up 2.59 points to 2,052.58. The Canadian dollar was down 0.64 of a cent to 103.28 cents US as the greenback strengthened against the loonie and other currencies late in the morning.
The TSX energy sector was up 0.2 per cent as the June crude contract on the New York Mercantile Exchange lost early gains to move down 60 cents to US$98.37 a barrel. Oil has been volatile this week after data Wednesday showed that U.S. gasoline demand dropped 2.4 per cent last week while oil supplies grew more than twice as much as analysts expected.

Suncor Energy (TSX:SU) rose 18 cents to $39.06 while Talisman Energy (TSX:TLM) was down 28 cents to $20.29.

The July copper contract also lost early momentum to turn unchanged at US$3.97 a pound, taking the TSX base metals group ahead 0.4 per cent. Teck Resources (TSX:TCK.B) rose 37 cents to C$46.15 and Quadra FNX Mining (TSX:QUX) ran ahead 20 cents to $13.53.

The gold sector climbed 0.65 per cent while the June gold contract in New York also gave up early gains to lose $3.20 to US$1,503.60 an ounce. Goldcorp Inc. (TSX:G) advanced 68 cents to C$46.49 while Barrick Gold Corp. (TSX:ABX) was ahead 20 cents to $43.64.

Commodity prices were also shaken this week by the feeling that global growth is slowing. Traders in particular looked to high inflation data from China which resulted in the country’s central bank ordering most banks to raise their reserve requirements in another move to cool the economy.

Resource stocks have also suffered in this environment and the TSX is down about 160 points for the week, closing Thursday about 50 points below where the main index started the year.

New York markets were lower amid data showing that American consumers paid more for gas and food in April, pushing inflation to its highest level in two and a half years.

The U.S. Labour Department said the Consumer Price Index increased 0.4 per cent in April. In the past 12 months, prices have risen 3.2 per cent. That’s the biggest 12-month gain since October 2008.

Excluding volatile food and energy, prices moved up 0.2 per cent during April. Gasoline prices have soared more than 33 per cent in the past year.

The Dow Jones industrial average slipped 55.9 points to 12,640.02.

The Nasdaq composite index was down 16.71 points to 2,846.33 while the S&P 500 index fell 6.12 points to 1,342.53.

On the earnings front, TMX Group Inc. (TSX:X), operator of the Toronto Stock Exchange, reported that profits rose 13 per cent in the first quarter to $64.3 million on stronger trading volumes. The company is in the midst of an attempted merger with the London Stock Exchange Group and its shares ticked two cents higher to $41.02.

Labrador Iron Ore Royalty Corp. (TSX:LIF.UN) more than doubled its first-quarter profit to $38.9 million, as its revenue increased 84 per cent over the comparable period of 2010. Its units rose 27 cents to $70.17.

Enerplus Corp. (TSX:ERF) shares gained eight cents to $29.22 reported net profit of $29.5 million in the first quarter, reversing a much bigger loss in the same quarter of 2010. The Calgary-based oil and gas producer with properties in Western Canada and parts of the United States, said the earnings compared with last year’s loss of $184 million.

Trading in Asia was lacklustre, as Japan’s Nikkei 225 slipped 0.7 per cent.

Nissan Motor Co. was up 3.5 per cent after announcing it had returned to profit in the fourth quarter, although uncertainties remain due to the damage from the March 11 earthquake and tsunami that have disrupted production for Japanese automakers.

Hong Kong’s Hang Seng closed with a 0.9 per cent gain, Australia’s S&P/ASX 200 gained 0.3 per cent while South Korea’s Kospi lost 0.1 per cent.

Mainland Chinese shares advanced, shrugging off the central bank increase in the reserve requirement for banks – the fifth such increase in 2011.

The benchmark Shanghai Composite Index rose one per cent while the Shenzhen Composite Index of China’s smaller, second exchange added 0.5 per cent.

European bourses lost early gains as London’s FTSE 100 index was up 0.04 per cent, Frankfurt’s DAX dipped 0.3 per cent and the Paris CAC 40 was off 0.21 per cent.
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