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

Thu Jan 16, 2014 4:50pm EST

* TSX rises 59 points, or 0.43 percent, to 13,831.58
    * Nine of the 10 main index sectors advance
    * Bombardier drops on CSeries delay
    * Saputo climbs on progress in battle for Warrnambool

    By John Tilak
    TORONTO, Jan 16 (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.
    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 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 
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 advanced 0.4 percent
to C$71.36, and Toronto-Dominion Bank climbed 0.2
percent to C$97.81.
    The materials sector, which includes mining stocks, rose 1
percent, with Teck Resources Ltd jumping 4.4 percent
to C$28.51.
    In corporate news, Australia's Bega Cheese Ltd said
it will sell its 18.8 percent stake in Warrnambool Cheese and
Butter Factory Co Holdings Ltd to Saputo Inc,
which has been seeking control of Warrnambool. The news drove
Saputo shares up 1.5 percent to C$51.68.
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California state worker Albert Jagow (L) goes over his retirement options with Calpers Retirement Program Specialist JeanAnn Kirkpatrick at the Calpers regional office in Sacramento, California October 21, 2009. Calpers, the largest U.S. public pension fund, manages retirement benefits for more than 1.6 million people, with assets comparable in value to the entire GDP of Israel. The Calpers investment portfolio had a historic drop in value, going from a peak of $250 billion in the fall of 2007 to $167 billion in March 2009, a loss of about a third during that period. It is now around $200 billion. REUTERS/Max Whittaker   (UNITED STATES) - RTXPWOZ

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