Toronto's main stock index closed higher on Friday after bullish economic data at home and abroad boosted confidence and lifted heavily weighted financial and resource stocks. The index's financial sector finished the day up 0.9 percent, energy was up 0.2 percent, and materials shares were 0.5 percent higher.
The data-packed day was highlighted by figures that showed robust Chinese imports, shrinking Canadian and US trade deficits and a rise in US consumer confidence. "The economic data we had today was very bullish, it was very encouraging for the economic outlook ... and has supported the recent rotation into risk assets," said Fergal Smith, managing market strategist at Action Economics.
"That's the tail wind of economic optimism that's filtering through the market and, of course, that gained huge traction this week with looser US fiscal policy," he added noting the deal between Democrats and Republicans to extend tax cuts. Insurers such as Manulife Financial Corp, which jumped 5.7 percent to C$16.89, were lifted by a profit picture made brighter by soaring bond yields and a broad rally in equity markets.
Banks have also benefited from the steepening of the yield curve, said Smith, as they can borrow more cheaply at the front end and invest at the higher-yielding long end. Royal Bank of Canada, the country's biggest lender, was up 0.5 percent at C$52.75.
The Toronto Stock Exchange's S&P/TSX composite index closed up 72.53 points, or 0.55 percent, at 13,239.47. It ended the week 0.5 percent higher. All 10 of its sectors rose, including cyclical technology stocks, up 0.9 percent on the day. Telecoms surged almost 1 percent, driven by BCE Inc, the country's biggest communications company, which gained 2.9 percent to C$36.09 after it raised its annual dividend for 2011.
Comments
Comments are closed.