Toronto stock market higher amid worse than expected economic data from eurozone

TORONTO—The Toronto stock market was modestly higher Thursday amid dismal economic data from Europe.

The S&P/TSX composite index advanced 32.42 points to 15,295.15.

The Canadian dollar was up 0.12 of a cent to 91.72 cents US, a day ahead of the release of revised employment data for July. Statistics Canada said earlier this week it had discovered an error in the jobs data that was originally released last Friday.

U.S. indexes registered small gains as Wal-Mart cut its annual profit forecast with the Dow Jones industrials ahead 11.78 points to 16,663.58, the Nasdaq was 4.45 points ahead to 4,438.57 and the S&P 500 index climbed 2.96 points to 1,949.68.

Wal-Mart also reported net income of $4.09 billion, or $1.26 per share, compared with $4.07 billion, or $1.24 per share, in the same quarter a year ago. Ex-items, earnings were $1.21 per share, which met analysts’ expectations. Revenue rose roughly three per cent to $119.34 billion, a shade ahead of expectations for $119.06 billion and its shares rose a penny to $74.04.

There was grim news from the eurozone as Germany’s economy, the region’s biggest, shrank by a quarterly rate of 0.2 per cent, held back by weaker investment by business and by fears over the crisis in Ukraine.

“The decline was more than expected and casts a shadow over the ‘strongman’ of the region,” said BMO Capital Markets senior economist Jennifer Lee.

“And, it certainly doesn’t help that businesses are increasingly nervous over the rocky relations with Russia, and the sanctions imposed,” Lee said.

France, the region’s second largest economy, showed zero growth for the second straight quarter. Third-ranked Italy shrank.

Ukraine fears have only grown since the end of the quarter on June 30, particularly after a Malaysian airliner was shot down in mid-July by a missile from territory held by pro-Russian separatists, according to the U.S. and Ukraine.

Meanwhile, a large Russian aid convoy resumed its journey toward Ukraine Thursday, taking a road leading directly toward a border crossing controlled by pro-Russian rebels.

Moscow has insisted it co-ordinated the dispatch of the goods with the international Red Cross. But the Red Cross is unable to confirm where the convoy is headed.

On Wednesday, Ukrainian President Petro Poroshenko accused Moscow of possibly planning a “direct invasion of Ukrainian territory under the guise of delivering humanitarian aid.”

Tech stocks led TSX advancers.

The energy sector rose 0.2 per cent, while September crude in New York declined 51 cents to US$97.08 a barrel.

The gold and base metal sectors were both flat with September copper down a cent at US$3.10 a pound, while December gold was $1.30 lower to US$1,313.20 an ounce.

In other earnings news, Iamgold Corp. (TSX:IMG) has reported a US$16-million net loss and $8.8 million in adjusted earnings for the second quarter. The adjusted earnings, reported in U.S. currency, amounted to two cents per share, a penny below analyst estimates. Its shares rose 16 cents to $4.36.

Tekmira Pharmaceuticals Corp. (TSX:TKM) is in discussions about making its experimental Ebola drug available to infected patients, but says there is no guarantee the treatment can be used to help quell the outbreak in West Africa. The Vancouver-based company also said Wednesday that its net loss in the second quarter was $6.1 million, or 28 cents per share, widening from $3 million, or 21 cents per share, in the same period a year earlier and its shares fell $1.20 or 5.89 per cent to $19.18.