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TSX edges higher amid earnings misses from energy heavyweights, mixed commodities

Toronto's main market posted small gains Wednesday, amid earnings misses from the nation’s energy heavyweights and mixed commodities.
TSX edges higher amid earnings misses from energy heavyweights, mixed commodities

Toronto's main market posted small gains Wednesday, amid earnings misses from the nation’s energy heavyweights and mixed commodities.

With little economic data on the docket, traders digested another batch of North American earnings. In the U.S., according to Bloomberg data, 74 per cent of companies in the S&P 500 index have beat analysts' estimates.

Overseas, the Royal Bank of Scotland (NYSE:RBS) was fined $612 million to U.S. and U.K. regulators for its part in the Libor rate-rigging scandal. Reports have said that 21 employees are accused of rigging global benchmark interest rates over a period of four years. 

Meanwhile, European Central Bank officials will meet Thursday, and it is widely expected that it will leave its key lending rate unchanged at 0.75%.

Back in Toronto, as of about 1 p.m. EDT, the S&P/TSX Composite was higher by 24.73 points, or 0.19%, to 12,770.38, while the more junior S&P/TSX Venture Composite fell 3.92 points, or 0.32% to 1,211.35.

Gold futures for April delivery ticked higher Wednesday, ahead of the ECB policy meeting this week. The yellow metal was lately up by $2.60 to $1,676.10 an ounce.

Meanwhile, crude futures inched higher after the U.S. Energy Information Administration reported that crude supplies rose 2.6 million barrels for the week ended February 1. Analysts polled by Platts expected a 3 million-barrel climb.

Crude for March delivery lately rose 12 cents to $96.76 a barrel.

Elsewhere, silver futures shed 8 cents to $31.79 an ounce, while the base metal copper contract lost 2 cents to $3.74 a pound.

Gold giants were higher Wednesday, with Kinross (TSE:K) up 0.61%, while Barrick Gold (TSE:ABX) added 1.14%, and Goldcorp (TSE:G) advanced 0.53%.

Toronto's main sectors were mostly higher, except for energy and utilities – off by 1.04% and 0.19%, respectively.

Materials were higher, led by advances in North American Palladium (TSE:PAL) – up 6.18%, while Detour Gold (TSE:DGC) and Tahoe Resources (TSE:THO) rose over 2.7% each.

Declines were seen in Pretium Resources (TSE:OVG) and Osisko Mining Corp. (TSE:OSK) - both losing over 3.4%.

In other metals and mining news, Silver Bull Resources (TSE:SVB)(NYSE MKT:SVBL) has announced an up to US$9.1 million public offering of its units to raise funds for work at its Sierra Mojada property in Mexico. 

Energy was lower Wednesday, dragged down by Canada's largest oil company Suncor Energy (TSE:SU)  - sliding 5.5% after it said it is considering putting the brakes on its Voyageur oil sands upgrade project, after late Tuesday posting a fourth-quarter loss due to a $1.49-billion writedown on the venture.

Meanwhile, Trican Well Service (TSE:TCW) and Canadian Natural Resources (TSE:CNQ) both lost over 1.5%.

Advances in the sector were seen in Advantage Oil & Gas (TSE:AAV) – up 3.74% after it announced the disposition of its non-core assets, provided an update on its Glacier Montney play, the appointment of financial advisors and natural gas hedging plans for 2013.

Meanwhile, Pacific Rubiales Energy (TSE:PRE) and Paramount Resources (TSE:POU) rose 2.26% and 1.87%, respectively.

In other energy news, Husky Energy (TSE:HSE) Wednesday posted a rise in fourth-quarter profit as refining margins rose, but still missed analyst views on lower oil prices, sending shares lower by 1.21%.

Financials were mixed, with the Royal Bank of Canada (TSE:RY) up 1.31%, while Manulife Financial (TSE:MFC) shed 0.28% and Sun Life Financial (TSE:SLF) fell 0.10%.

In Canadian corporate news, shares of BlackBerry (TSE:BBY) (NASDAQ:BBRY) were volatile Wednesday – lately ahead on the TSX, but down on the Nasdaq. There are mixed feelings on the launch of the Z10 smartphone in the U.K, with some analysts believing early stock-outs were a sign of strong demand, while others see this as a sign of limited supply. 

There were also reports that there were little or no lines outside of retail stores in Canada, where its new BB10 device launched yesterday, despite record pre-orders, and that the U.S. launch of the Q10 device may come later than expected. 

Toronto Stock Exchange operator TMX Group (TSE:X) Wednesday reported a profit in its fourth quarter - the first full quarter since it was acquired by a consortium of Canadian financial institutions last year.

For the quarter that ended December 31, profit was $32.8 million or 61 cents per diluted share, compared to a loss of $10.2 million or $54.77 per share, a year earlier, before TMX was taken over by Maple Group. 

WestJet (TSE:WJA) Wednesday said its fourth quarter profits shot up over 70 per cent on “record high” load factors, topping analyst views and sending shares higher. The news comes just a day after Canada's second biggest airline reported that its January load factor, or the percentage of available seats filled with paying customers, was 80.9 per cent, up from 79.9 percent a year earlier.

On the economic beat, the Ivey Purchasing Managers Index moved up to 58.9 as at the end of January from  52.8 in December; but down from 64.1 in the year-ago period. A figure above 50 shows an increase in purchasing while below 50 shows a decrease.

Meanwhile, Finance Minister Jim Flaherty is speaking in Ottawa today, with expectations that he will announce the date of the next budget.


U.S. stocks moved between slight gains and losses Wednesday, as investors waded through another batch of earnings, and amid concerns about the political drama unfolding in Italy.

The Dow was lately down 10 points to 13,969.30, the Nasdaq fell 5.9 points to 3,165.69, and the S&P 500 moved down 2.08 points to 1,509.21.

With no big economic reports due out, investors focused on earnings. Of the 294 companies in the S&P 500 that have reported results so far, 188 have beat analysts' expectations, according to S&P Capital IQ.

Shares of Ralph Lauren Corp. (NYSE:RL) jumped about 8% after reporting a surprise 28% rise in fiscal third quarter profit, on high gross margins, topping forecasts on a better-than-expected holiday season. 

Entertainment giant Time Warner (NYSE:TWX) also reported fourth quarter profit of $1.21 per share, topping views for $1.10 a share. It also lifted its quarterly dividend by 11%. Shares of the company rose more than 4%.

CVS Caremark (NYSE:CVS) said fourth quarter profit rose 6%, with adjusted earnings of $1.14 per share, beating forecasts for $1.10 a share as revenues rose. 

IntercontinentalExchange (NYSE:ICE) rose 1.06% after it said its fourth-quarter earnings edged up 2.1% as the exchange operator posted lower expenses, though transactions and clearing revenue declined. 

Zynga (NASDAQ:ZNGA) shares rose more than 12%, a day after it reported a smaller-than-expected loss and higher-than-expected bookings for the fourth quarter as mobile takes focus at the company. 

Online travel company Expedia (NASDAQ:EXPE) reported a 10% rise in fourth quarter profit as sales grew to $975 million from $787 million a year ago. Profit fell short of analyst forecasts, while revenue beat by a wide margin. 

But the company's stock fell by more than 2% after RBC Capital cut the rating on the stock to sector perform, arguing that Expedia is now likely to enter a period of growth deceleration. 

Chipotle Mexican Grill (NYSE:CMG) rose more than 5%, a day after the burrito chain reported higher earnings of $1.95 per share, a penny below estimates. 

Walt Disney Co. (NYSE:DIS) shares also advanced after it said late Tuesday that its fiscal first-quarter earnings fell 6%, but adjusted earnings of 79 cents a share topped analysts' views for 76 cents a share, while higher revenue also beat forecasts. 

After the closing bell, Visa (NYSE:V) is projected to post first-quarter earnings of $1.79 a share, with its earnings to come alongside News Corp (NASDAQ:NWSA), Yelp (NYSE:YELP) and Green Mountain Coffee Roasters (NASDAQ:GMCR).

In other corporate news, shares of Elan Corp (NYSE:ELN) were down more than 8% after it said it would restructure its collaboration on multiple sclerosis drug Tysabri with Biogen Idec (NASDAQ:BIIB). Under the deal, Biogen will pay Elan $3.25 billion up front, plus royalties on future sales, for the complete asset. 

Biogen shares rose more than 3% after news of the deal. 

European markets finished mixed as of the most recent closing prices. The FTSE 100 gained 0.20%, while the CAC 40 led the DAX lower. They fell 1.40% and 1.09% respectively.

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Canadian Market Wrap Timeline

October 16 2015

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