TORONTO – The Toronto stock market started Wednesday’s session higher led by metals and mining stocks, while U.S. traders remain focused on discussions over the looming “fiscal cliff” deadline.
The S&P/TSX composite index rose 39.75 points to 12,374.09, while the TSX Venture Exchange gained 2.60 points to 1,178.60.
The Canadian dollar was down 0.16 of a cent to 101.29 cents US.
The TSX metals and mining sector gained 1.3 per cent, with Sherritt International (TSX:S) rising six per cent to $5.71.
Energy stocks rose 0.3 per cent as the January crude contract on the New York Mercantile Exchange rose 33 cents to US$88.26 a barrel.
March copper declined about four cents to US$3.62 a pound while February gold bullion moved down $1.30 to US$1,669.40 an ounce.
The U.S. Commerce Department said that builders broke ground on fewer houses in November, likely in part due to Superstorm Sandy in the Northeast. The report says builders began construction of homes at a seasonally adjusted annual rate of 861,000. That’s three per cent lower than October’s annual rate of 888,000, which was the fastest since July 2008.
“Keep in mind that growth in housing starts was extremely strong in the prior three months, so some giveback is not a concern at this point, especially given what permits did in November,” BMO Capital Markets economist Robert Kavcic writes in a note.
The potential budget deal in the U.S. has grabbed the focus of traders in recent sessions, and while a compromise hasn’t been reached between the White House and Congress, sentiment has improved.
Markets appear to be confident that President Barack Obama and Republican leaders will reach a deal to avoid the so-called “fiscal cliff,” a series of automatic tax hikes and government spending cuts that will start coming into effect at the start of next year and have the potential of derailing the U.S economic recovery.
The Dow Jones industrials gained 3.73 points to 13,354.69 and the Nasdaq rose 5.14 points to 3,059.67. The S&P 500 index was off 0.11 of a point at 1,446.68.
Meanwhile, the Teranet-National Bank Canadian housing price index fell in November from a month earlier. The composite index covering 11 major urban centres stood at 154.02 last month, down 0.4 per cent from October.
Canadian bank CIBC is forecasting “very mediocre” domestic growth next year, blaming weakness in the world economy and an absence of key economic drivers at home. CIBC says it now expects economic growth of only 1.7 per cent in 2013, down from its previous estimate of two per cent.
In Europe, the FTSE 100 index of leading British shares was up 0.6 per cent at 5,974 while Germany’s DAX rose 0.3 per cent at 7,677. The CAC-40 in France was 0.3 per cent higher at 3,662.
Earlier in Asia, stocks did well too, with Hong Kong’s Hang Seng index up 0.6 per cent to 22,623.37 and Shanghai’s main index of Chinese shares closing flat at 2,264.30.
Japan’s Nikkei 225 index was the start turn, surging 2.4 per cent to close at 10,160.40, the first time the benchmark has closed above 10,000 since April 3.
The stock market advance came three days after a landslide election victory by the Liberal Democratic Party. Shinzo Abe, head of the LDP, has pledged to keep the yen from strengthening and take measure to boost the deflation-mired economy.