The Toronto Stock Exchange's main index finished higher for the fourth day in a row on Friday, ending a volatile session with a lift from financial shares. But the index ended the month down 6.4 percent, its biggest monthly decline since September 2002, even after a rally this week helped recover some of November's steep losses.
The financial sector rose 1.2 percent on Friday despite a drop in Royal Bank of Canada shares after the country's largest bank reported slower profit growth in the fourth quarter.
The financial group has been plagued recently by news of writedowns on both sides of the border, stemming from the US subprime mortgage market meltdown and the subsequent credit crunch. But the sector got support this week from the results from some of Canada's big banks, including a 44 percent jump in profit at Toronto-Dominion Bank.
Royal closed down 67 Canadian cents, or 1.3 percent, at C$53.00, while Toronto-Dominion was up C$3.20, or 4.5 percent, at C$75.00. "We had overbearing concerns about the US situation and this week we certainly saw those concerns recede thanks to some pretty decent numbers from the Canadian banks," said Elvis Picardo, investment strategist at Northern Securities Inc in Vancouver.
"One can only hope that the buyers come back in December and we at least close the year on a positive note." The S&P/TSX composite index closed up 25.23 points, or 0.18 percent, at 13,689.12 with eight of the 10 main sectors higher.
The industrials sector also provided buoyancy, gaining 1.5 percent after regional US airline SkyWest Inc placed an order for 22 jets from Bombardier Inc in a deal worth about $773 million.
Plane and train maker Bombardier was up 20 Canadian cents, or 3.4 percent, at C$6.05. The TSX materials sector added 0.4 percent, pulled higher by fertiliser producer Potash Corp of Saskatchewan, which was among the biggest gainers on the index by weight, rising C$3.30, or 2.9 percent, to C$118.80.
On the downside, the energy sector took its cue from the price of oil, slipping 0.9 percent as the commodity hit a one-month low on US economic worries. Crude was down $2.30 at $88.71 a barrel. Suncor Energy fell C$1.89, or 1.9 percent, to C$95.61, and Canadian Natural Resources gave up C$2.11, or 3.2 percent, to C$64.92.
Analysts said that there was still a great deal of uncertainty among investors. "Markets are rallying, but the question that remains is whether it's an oversold bounce or a bone fide recovery," said Matt Blackman, technical analyst and host of TradeSystemGuru.com.
"The concern is that financials, including banks and retail stocks, have been breaking down and that is a concern given that the lion's share of our and the US economy relies on consumer spending." Market volume was a heavy 510 million shares worth C$9.8 billion. Advancers outpaced decliners 983 to 678. The blue chip S&P/TSX 60 index closed up 0.44 point, or 0.06 percent, at 798.50.
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