Canadian shares traded higher as a solid rebound in energy stocks overpowered disappointing earnings. The benchmark Standard & Poor’s/TSX Composite Index (TSE:OSPTX) rose 0.5 percent to 14,368.57 at 12:34 p.m. in Toronto. Seven out of 10 share groups were in the positive territory.
The energy sector, the main index's second most heavily weighted group, gained 2.9 percent as oil, Canada’s largest export, rose modestly. Enbridge (TSE:ENB), Canada's largest pipeline company, gained 1.4 percent to $56.25.
Suncor Energy (TSE:SU) rose 5.7 percent to C$36.61. Canada’s largest crude-oil producer said its operating profit fell to C$0.63 per share in the second quarter on lower oil prices. The results was nonetheless above analyst expectations.
Cenovus Energy (TSE:CVE) rose 2.6 to C$19.12. The oil-sands producer, also contending with lower oil prices, slashed its dividend by 40 percent and said it was accelerating its cost-cutting efforts, including cutting up to 400 jobs in its Calgary offices.
Brent was up 1 percent at $53.88 a barrel, extending its slight rise in the previous session. U.S. crude climbed 0.4 percent to $48.99.
The materials sub-index, which includes mining shares, slipped 1.2 percent as gold fell 1 percent. Goldcorp (TSE:G), Canada’s largest gold miner by market value, skidded 0.8 percent to C$16.55 after slashing its dividend as part of its strategy to cope with a “volatile gold market.” Barrick Gold (TSE:ABX), the second-largest, sank 2.6 percent to C$9.14.
Detour Gold (TSE:DGC) gained 8.2 percent to C$12.46. The operator of the Detour Lake mine in Canada had a breakeven second quarter on an adjusted basis, well above expectations for a loss of $0.09 per share. Gold production was a record and costs were lower. National Bank Financial called the result “an exceptional financial beat.”
Potash Corp of Saskatchewan (TSE:POT) rose 1.8 percent to C$35.39. The fertilizer company posted a 12 percent drop in its second-quarter profit and scaled back the top end of earnings guidance for the year as weaker nitrogen prices impacted results.
Financials, the index's most heavily weighted sector, was little changed. Royal Bank of Canada (TSE:RY), which has the heaviest weighting in the index, rose 0.3 percent to C$75.89. Toronto-Dominion Bank (TSE:TD), the second-largest bank by market value, was flat at C$52.64.
Open Text (TSE:OTC) jumped 19.6 percent to $58.30. The supplier of Enterprise Information Management software said Its adjusted profit of C$0.87 per share was well ahead of analyst estimates. RBC Capital Markets upgraded the stock to outperform.
Bombardier (TSE:BBD.B) tumbled 10.3 percent to $1.75 after the maker of planes and trains posted a 19 percent drop in its second-quarter profit on lower revenue.
The junior S&P/TSX Venture Composite Index (CVE:OSPVX) rose 0.6 percent to 588.16 at 12:39 p.m. in Toronto.
In economic news, A measure of confidence among Canadian small businesses dropped to the lowest since 2009 in July, with optimism weakest in Alberta and in the resource sector. The Canadian Federation of Independent Business Barometer index fell to 58.2 in July, the Toronto-based group said today. That’s the lowest reading since mid-2009.
In the U.S. market, shares traded mixed today as investors digested more earnings and second quarter GDP, a day after the Federal Reserve left interest rates unchanged. The S&P 500 (INDEXSP:.INX) slid 0.1 percent to 2,105.93 at 12:06 p.m. in New York. The 30-company Dow Jones Industrial Average (INDEXDJX:.DJI) skidded 0.1 percent to 17,734.29, and the tech-heavy Nasdaq Composite (INDEXNASDAQ:.IXIC) rose 0.1 percent to 5,116.08. Most followed shares included Facebook, P&G, Whole Foods, Skechers, Colgate-Palmolive, ConocoPhillips, Cigna, Marriott, NCR, Nokia, and LifeLock.