Bank stocks take TSX higher

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The Toronto stock market closed slightly higher Friday as a late-day burst in financial stocks cancelled out declines in energy and gold stocks.

The S&P/TSX composite index moved 33.91 points higher to 10,389.76 on top of two days of strong, triple-digit advances.

The Canadian dollar was up 0.15 of a cent to 86.64 cents US.

Despite the gains of the S&P/TSX index over the past three days, momentum from the spring rally that started in mid-March has been slowing but the Toronto market managed a gain of 102 points for the week.

As the first half of 2009 draws to a close, investors are growing more nervous about whether the economy can bounce back later this year.

At its peak June 11, the rally had taken the TSX to the 10,714-mark, up 41% from the trough on March 9 and almost 20% year to date.

"And we haven’t had a big pullback really — the rally is getting tired but that doesn’t mean it’s over," said John Johnston, chief strategist for the Harbour Group at RBC Dominion Securities.

"I would suspect that there’s over the next three months a little more downside than upside. But that downside is part of a healthy rebound in the market."

On Friday, the financial sector was the biggest gainer, up 1.85% with Scotiabank ahead $1.19 to $43.

The Toronto market’s energy sector was down 2.3% with the August crude contract in New York falling $1.07 to US$69.16 a barrel. EnCana Corp. lost 77 cents to $56.81.

Shares in market heavyweight Potash Corp. sustained only a minor loss after the company cut its earnings guidance, citing lower-than-expected sales volumes as customers delay purchases and lower realized prices for phosphate fertilizers.

Potash shares fell 39 cents to $107.66, after falling as low as $103.66 during the session.

U.S. stocks were mainly lower after the Commerce Department said personal spending, incomes and savings all rose in May. What troubled investors was that the savings rate soared to a 15-year high of 6.9%, while spending rose by a modest 0.3%.

The Dow Jones industrial average declined 34.01 points to 8,438.39, losing 101 points or 1.2% on the week.

The Nasdaq composite index was up 8.68 points to 1,838.22, supported by Palm Inc. a day after the company reported a fourth-quarter loss that was narrower than expected. The company also highlighted strong demand for its Pre smartphone and its shares rose $2.20 or 15.7% to US$16.22.

The S&P 500 index dipped 1.36 points to 918.9.

The gold sector was another source of weakness, down 2% as the August gold contract on the Nymex gained $1.50 to US$941 an ounce. Goldcorp Inc. faded 80 cents to $41.54.

In other corporate news, Shaw Communications Inc. shares were ahead 22 cents to $19.77 after the company reported third-quarter profit of $132 million or 31 cents per share, up slightly from year-earlier net income of $128 million or 30 cents per share. Quarterly revenue rose 9% to $861 million.

Semiconductor company Mosaid Technologies Inc. reported Thursday an increase in fourth-quarter profits compared with a year ago as revenue grew 6%. The semiconductor company said it earned $5.6 million compared with a profit of $5.4 million a year earlier. Its shares declined 26 cents to $14.99.

The Sobeys grocery chain gave a strong push to revenue growth in the latest quarter at Empire Co., although the diversified holding company’s real-estate and investment activities proved to be a drag on profitability. Empire’s overall net income for the quarter fell to $63.6 million, down from $66.5 million in the fourth quarter of fiscal 2008 and its shares stepped back $1.12 to $45.20.

Swiss bank UBS AG announced that it expects to raise 3.8 billion Swiss francs (US$3.5 billion) through a capital increase and forecasts a loss for the second quarter. In New York, its shares fell 69 cents to US$12.18.

(THE CANADIAN PRESS)

North American markets

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	Close	Change	YTD
Dow Jones	8,438.39	-34.01 or -0.40%	-3.85%
S&P 500	918.90	-1.36 or -0.15%	+1.73%
NASDAQ	1,838.22	+8.68 or +0.47%	+16.56%
TSX Composite	10,389.76	+33.91 or +0.33%	+15.60%

International markets

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	Close	Change	YTD
Nikkei	9,877.39	+81.31 or +0.83%	+11.49%
Hang Seng	18,600.26	+325.23 or +1.78%	+29.28%
SENSEX	14,764.64	+419.02 or +2.92%	+53.04%
FTSE 100	4,241.01	-11.56 or -0.27%	-4.36%
CAC 40	3,129.73	-33.37 or -1.05%	-2.74%
DAX	4,776.47	-24.09 or -0.50%	-0.70%

Bonds

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Bonds	$Current	$Previous	%Yield
Cdn. 10-year bond	103.08	102.81	3.38
Cdn. 30-year bond	118.99	118.59	3.88
U.S. 10-year bond	96.84	96.63	3.51
U.S. 30-year bond	99.13	98.77	4.30

Currency

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BoC Close	Today	Previous
Canadian $	0.8664	0.8649
US $	1.1542	1.1562

Euro Spot Rate	Today	Previous
Canadian $	0.6159	0.6181
Euro	1.6237	1.6177

Commodities

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Gold	AM	PM
London Gold Fix ($US)	$943.00	$942.00

Oil	Close	Change
WTI Crude Future (US)	$69.35	-$0.88 or -1.25%

(06/26/09)