TORONTO - The Toronto stock market finished higher for a second day Wednesday with Canadian bank stocks receiving a solid lift after TD Bank's (TSX:TD) earnings beat expectations, showing that Canadian financial companies appear much better off than their troubled U.S. rivals.
One Bay Street money manager called Canada's big banks, which report their quarterly results over the next two weeks, "an oasis of calm" compared with the troubled U.S. banking sector on Wall Street.
Energy stocks were also supportive on rising crude prices, and there was a big deal in the fertilizer sector.
Toronto's S&P/TSX composite index closed up 72.97 points to 7,932.3 on top of Tuesday's 212-point surge. The TSX Venture Exchange added 1.38 points to 854.97.
New York markets finished sharply lower with losses accelerating in the final minutes of the session as investors digested dismal housing data and got more clarity about how the U.S. government plans to help the financial sector.
New York's Dow Jones industrials closed down 80.05 points to 7,270.89 following a 236-point jump. The Nasdaq composite index fell 16.4 points to 1,425.43 and the S&P 500 index moved down 8.24 points to 764.9.
The Canadian dollar fell 0.72 of a cent to 79.71 cents US.
The Toronto financial sector rose three per cent after TD reported first-quarter net income fell 27 per cent to $712 million, but were better than analyst expectations. All TD's major businesses showed solid profits, including U.S. personal and commercial banking, but provisions for credit losses more than doubled to $537 million from $255 million.
TD shares advanced 60 cents to $35.85 and Royal Bank (TSX:RY), which reports Thursday, was up $1.51 to $29.99.
"I think a lot of people are expecting that there will be better days ahead for the banks," said John Stephenson, portfolio manager at First Asset Funds.
In the meantime, "everybody is looking at the U.S. and seeing the ongoing conversations about the nationalizations of the banks or whether they will be nationalized or not -- and saying `How can we really be this oasis of calm?"'
There was some relief on the nationalization issue as Federal Reserve chairman Ben Bernanke again poured cold water on speculation that the government may nationalize Citigroup or other big banks. Still, Citigroup was down eight cents to US$2.52.
And U.S. Treasury Department officials said that new financial support for banks will be provided through the government's purchase of preferred shares of their stock that are convertible into common shares at a 10 per cent discount to their price before Feb. 9. The preferred shares will carry a nine per cent dividend and be convertible at the bank's option, but subject to regulatory approval.
The option to convert the preferred shares into common shares is a change in the rescue program designed to give financial markets greater confidence.
The U.S. National Association of Realtors said sales of existing homes fell 5.3 per cent last month to the weakest showing since July 1997. Wall Street had hoped sales would rise.
Fertilizer giant Agrium (TSX:AGU) made a US$3.6-billion bid to buy U.S.-based fertilizer firm CF Industries Holdings. Any deal is contingent on CF ending its US$2.1-billion takeover bid for Terra Industries Holdings. Agrium shares were down $ 4.27 to $46.03.
The Toronto energy sector was ahead 1.9 per cent as the April crude contract on the New York Mercantile Exchange rose $2.54 to US$42.50 a barrel. Data showed U.S. crude inventories rose 700,000 barrels last week, much less than the expected increase of two million barrels. U.S. gasoline inventories dropped almost two per cent for the week while gasoline production increased.
EnCana Corp. (TSX:ECA) gained $1.99 to $48.10 . Petro-Canada (TSX:PCA) advanced 63 cents to $27.01 .
The TSX gold sector slipped 0.3 per cent after the April bullion contract in New York slipped $3.30 to US$966.20 an ounce.
Iamgold Corp. (TSX:IMG) was off four cents to $9.61 after the company lost $96.4 million in the fourth quarter, largely due to charges on the Buckreef project in Tanzania.
Media company Quebecor Inc. (TSX:QBR.B) reported that its fourth-quarter net loss improved to $343.7 million from $962.6 million a year ago when it had $1.1 billion in losses on discontinued operations. Full-year profit came in at $187.3 million, compared to a 2007 loss of $969.2 million. Its shares were up 77 cents to $17.28 .
Shares in debt-strapped Canwest Global Communications Corp. (TSX:CGS) were off two cents to 32 cents after the company raised a little cash by selling part of its stake in sports broadcaster The Score for $6.6 million. Canwest faces a deadline at the end of the week for a $100-million debt facility.
Shares in Nortel Networks (TSX:NT) were unchanged after the telephone equipment provider said it's laying off another 3,200 employees worldwide in an ongoing effort to restructure under court protection from creditors.
