A sign board displays Toronto Stock Exchange (TSX) stock information in Toronto.Mark Blinch/Reuters
Resource stocks gave the Toronto stock market a solid advance mid-morning Thursday amid data showing business activity declining in China and Europe and another report indicating the U.S. continues to be the major global economic prop.
The S&P/TSX composite index was ahead 73.11 points to 15,053.26 as data suggested Europe faces the possibility of sliding back into recession while Chinese manufacturing activity fell to a six-month low during November.
The Canadian dollar was up 0.33 of a cent to 88.43 cents (U.S.). The dollar found lift from a report showing wholesale sales increased 1.8 per cent from August to $54-billion in September, much higher than the 0.8 per cent gain that economists had expected.
U.S. indexes were mixed but off early lows as the Philadelphia Fed index, a snapshot of manufacturing activity in the U.S. Northeast, jumped to 40.8 in November – far higher than the 18.5 reading that had been expected – from 20.7 in October. This is the highest reading of activity since December 1993. Both new orders and shipments rose sharply in November. Labor market indicators also improved.
The Dow Jones industrials fell 38.23 points to 17,647.5, the Nasdaq gained 7.51 points to 4,683.22 and the S&P 500 index was off 1.43 points to 2,047.29.
Worries about Europe grew after financial information company Markit said its purchasing managers' index for the euro zone, a broad gauge of business activity, fell to a 16-month low of 51.4 points in November from 52.1 in October. Though anything above 50 indicates expansion, the survey suggests a recession could be on its way.
And HSBC's preliminary purchasing managers' index for China fell to 50 this month from 50.4 in October, reflecting sluggishness in the world's second-biggest economy and weakness abroad.
It's the latest sign that China's economy continues to struggle after growth in the third quarter slowed to a five-year low of 7.3 per cent.
North American markets generally closed little changed Wednesday after minutes from the October meeting of the Federal Reserve failed to provide any new insights on the timing of an interest rate hike, generally expected sometime later in 2015.
Most strength on the TSX came from a 1.6 per cent bounce in the energy sector as December crude edged up 59 cents to $75.17 (U.S.) a barrel.
The gold sector ran ahead 1.7 per cent while December bullion faded $4.60 to $1,189.30 an ounce.
Both sectors have registered steep declines this fall amid falling prices for bullion and crude.
The base metals sector ticked 0.6 per cent higher while December copper fell two cents to $3.03 a pound.
The consumer staples sector led decliners with grocer Metro giving up about half of the gain racked up Wednesday in the wake of a positive earnings report, down $2.80 to $87.70.
On the corporate front, Toronto-based company Brookfield Asset Management has abandoned its plan to buy the former Revel Casino Hotel in Atlantic City, dealing another blow to a city reeling from a string of casino closures and the disappearance of thousands of jobs. Brookfield planned to buy the casino for $110-million from bankruptcy court. It had said it would reopen the business as a casino-hotel but never said how soon that would happen. Its shares were 29 cents lower to $56.20 (Canadian).