The Toronto Stock Exchange continued its lose-one-win-one pattern on Thursday, following Wednesday's late-afternoon losses with solid gains as oil prices rose and Asian countries reported economic growth.
The benchmark S&P/TSX composite index advanced by 185.21 points, or 1.62 per cent, to close at 11,635.85, with all 10 sub-indexes advancing, led by oil and gas and financials.
The price of crude oil on the New York Mercantile Exchange rose $1.10 US to $75.48 US a barrel on forecasts of growing demand. The Canadian dollar, whose fortunes tend to rise and fall with the price of oil, took a big leap on Thursday, up 1.21 cents to 96.97 cents US — its highest close in more than a month.
Canadian Natural Resources benefited from the gain in oil, rising 3.94 per cent to $37.16.
Gold fell $7.70 US to $1,222.20 US an ounce.
One of the brightest spots on the S&P/TSX on Thursday was Storm Exploration Inc., which advanced by 18.52 per cent to $13.63 after ARC Energy Trust reported it was buying the company for $680 million.
Teck Resources also made a good showing Thursday, rising 5.33 per cent to $34.19, and Potash Corp. of Saskatchewan was 3.73 per cent higher at the end of the day, at $103.54.
In economic news on Thursday, Statistics Canada reported the country posted a $175-million trade surplus last month, much less than the $600 million expected by analysts, as a drop in exports was outweighed by a bigger drop in imports.
The United States posted a trade deficit of $40.3 billion US, which was slightly better than expected. What really moved the markets, however, was the report out of China that its trade surplus for May was $19.5 billion US, more than twice what analysts had estimated.
"People are basically saying what's happening in Europe doesn't have any impact on the economic situation" because of strong numbers from Asia, Stephen Gauthier at Fin-XO Securities Inc. in Montreal, told Bloomberg. "It's not a disaster so far in China."
U.S. stocks seemed unaffected by news that more Americans than anticipated filed applications for unemployment benefits last week, a sign that the job situation in that country remains rocky.
"Initial jobless claims continued to tread water at around the 450,000 range," Meny Grauman, an economist at CIBC World Markets, wrote in a note. "That is much better than where it was this time last year, but still only consistent with very modest payroll growth. That suggests a very long recovery process for the labour market, and helps makes the case that U.S. Federal Reserve will keep rates on hold for even longer than what the market currently expects."
The Dow Jones industrial average advanced 273.28 points or 2.76 per cent to 10,172.53, while the Nasdaq composite was up 59.86 points, or 2.77 per cent, to 2,218.71.
The junior Venture composite index rose 8.34 points, or 0.58 per cent to 1,452.91.
European and Asian markets also posted strong gains on Thursday.