Canadian shares edged higher today, led by miners, as gold futures were poised to settle above $1,200 an ounce for the first time in nearly a month amid hints from the Federal Reserve it may raise interest rates at a gradual pace.
The benchmark Standard & Poor’s/TSX Composite Index (TSE:OSPTX) rose 0.3 percent to 14,772.53 at 12:43 p.m. in Toronto. Five shares advanced for every four stocks that declined as six out of ten share groups were in the positive territory.
In a press conference following the end of the Fed's two-day policy meeting yesterday, Fed Chair Janet Yellen said she wanted "more decisive evidence" that labor markets were healing, and that wages would increase beyond their current "subdued pace." Sentiment in Canada is often influenced by news out of the United States, Canada's largest trading partner.
The energy sector, the main index's second most heavily weighted group, slipped 0.3 percent even as oil, Canada’s largest export, gained on a weaker dollar.
Suncor Energy (TSE:SU), Canada's largest oil sands producer, sank 0.9 percent to C$34.16. Enbridge (TSE:ENB), Canada's largest pipeline company, added 0.3 percent to C$55.69.
July crude tacked on 0.3 percent to $60.12 a barrel on the New York Mercantile Exchange Brent crude for August delivery rose 0.3 percent to $64.08 a barrel on London’s ICE Futures exchange.
The materials sub-index, which includes mining shares, gained 0.5 percent as gold futures leaped. Goldcorp (TSE:G), Canada’s largest gold miner by market value, gained 1.9 percent to C$20.75. Barrick Gold (TSE:ABX), the second-largest, rose 1.5 percent to C$14.34.
McEwen Mining (NYSE:MUX) gained 3.4 percent to C$1.23. The gold and silver producer declared an initial annual dividend of 1 U.S. cent per share. The company’s new dividend will be paid semiannually, beginning this August.
Gold for August delivery jumped 2.2 percent to $1,202.20 an ounce on Comex.
Financials, the index's most heavily weighted sector, fell 0.3 percent. Royal Bank of Canada (TSE:RY), which has the heaviest weighting in the index, fell 0.2 percent to C$77.90. Toronto-Dominion Bank (TSE:TD), the second-largest bank by market value, slipped 0.5 percent to C$53.59.
Lumenpulse (TSE:LMP) skidded 0.1 percent to $18.00. The LED lighting maker swung to an adjusted profit of C$800,000 in the fourth quarter of fiscal 2015, from a loss of C$1.3 million the year prior. It recorded revenue of C$31 million for the quarter, a 14 percent increase from the year before. RBC started coverage of Lumenpulse at outperform on Tuesday.
AirBoss of America (TSE:BOS) climbed 10.1 percent to C$20.12 after it agreed to buy Immediate Response Technologies LLC for about $37 million in cash. An extra amount of up to $25 million in cash and equity could be payable based on the company’s performance in the 60 months after the deal closes. TD raised the company’s rating to buy from hold, increasing its target price from $15.50 to $19.
The junior S&P/TSX Venture Composite Index (CVE:OSPVX) gained 0.5 percent to 684.93 at 12:22 p.m. in Toronto.
In the U.S. market, shares moved sharply higher today as a fresh batch of economic news supported investors’ view that the Federal Reserve will raise interest rates only gradually. The S&P 500 (INDEXSP:.INX) rose 1 percent to 2,121,21 at 11:51 a.m. in New York. The 30-company Dow Jones Industrial Average (INDEXDJX:.DJI) gained 1.1 percent to 18,138.66, while the tech-heavy Nasdaq 100 (INDEXNASDAQ:NDX) gained 1.4 percent to 5,133.37. Most followed shares included BioMarin, Rite Aid, Lumenis, Oracle, Jabil Circuit, Southwest Airlines, Kroger, Fitbit, Colgate Palmolive, Bankrate, AT&T