TSX advances on earnings news, oilpatch acquisition
Published Wednesday, February 19, 2014 4:20AM EST
Last Updated Wednesday, February 19, 2014 12:11PM EST
TORONTO -- The Toronto stock market was higher amid a major oilpatch acquisition along with earnings disappointments and dividend cuts in the resource sector.
The S&P/TSX composite index gained 64.79 points to 14,142.26 as investors also considered another example of how the U.S. economy is being hit by severe winter weather.
The Canadian dollar fell 0.7 of a cent to 90.62 cents US.
New York indexes were mixed while the U.S. Commerce Department reported that U.S. housing starts fell by 10 per cent to an annualized rate of 899,000 in January, down 16 per cent from December. In December, construction had fallen almost five per cent.
"The housing data was soft and to a certain extent I think the ongoing weather distortions will probably continue through another month, because February hasn't been any better in the U.S.", said Colin Cieszynski, senior markets analyst at CMC Markets.
The Dow Jones industrials gained 56.61 points to 16,187.01, the Nasdaq was down 1.49 points to 4,271.3 while the S&P 500 index was up 3.35 points to 1,844.11.
On the earnings front, Sherritt International Corp. (TSX:S) reported a $38.1 million adjusted net loss in the fourth quarter, equal to 13 cents per share as it recognized a $466.8 million impairment loss related to the sale of its coal business. Analysts had expected Sherritt's adjusted earnings would break even. Sherritt cut its quarterly cash dividend to one cent from about four cents per share. Its shares fell 30 cents or 8.75 per cent to $3.13.
Power producer Boralex Inc. (TSX:BLX) said its quarterly cash flow from operations was $16.1 million or 43 cents per share, up from $13.5 million or 36 cents per share a year ago. Boralex will also pay its first dividend, 13 cents per shares. Its shares ran ahead 67 cents or 5.41 per cent to $13.05.
Cargojet (TSX:CJT) shares jumped $3.24 or 22.56 per cent to C$17.60. The cargo carrier has been awarded a domestic air cargo network services contract for the Canada Post group of companies, including Purolator's national air cargo network. The company projects revenues will be approximately $1 billion during the initial seven-year agreement, based on projected volumes.
The energy sector led advancers, up 1.06 per cent while the March crude contract on the New York Mercantile Exchange gained 57 cents to US$103 a barrel.
Canadian Natural Resources Ltd. (TSX:CNQ) jumped $1.79 or 4.57 per cent to C$40.97 as it said that it will pay $3.125 billion cash to buy conventional oil and gas assets near its core areas in Western Canada in a major land deal with Devon Canada.
"The street likes it," added Cieszynski.
"And it's a conventional pickup, which is not a bad thing for them because they have such a big piece of oilsands and this is more conventional oil so it probably balances out their production a bit more."
The base metals sector was down 0.16 per cent while March copper was ahead one cent at US$3.29 a pound.
The gold sector slipped 0.07 per cent while April bullion faded $3.50 to US$1,320.90 an ounce.