Stocks keep momentum on Fed announcement
Wednesday, March 20, 2013 04:19 PM EST Stocks keep momentum on Fed announcement BlackBerry, health stocks ride high North American stock markets were moderately higher at day’s end Wednesday, after the Federal Reserve’s latest assessment of the U.S. economy indicated no change in the central bank’s policy. The S&P/TSX index gained 52.68 points to finish the session at 12,826.55 The Canadian dollar captured 0.17 cents to 97.49 cents U.S. Tech stocks proved the star of the show Wednesday, mostly on the shoulders of BlackBerry – the company formerly known as Research In Motion – whose shares traveled north $1.01, or 6.6%, to $16.43. Energy stocks got some lift as Canadian Natural Resources Ltd. was up 32 cents, or 1%, to $33.60 per share. Health-care issues rocketed higher, too, as Catamaran Corporation climbed $1.47, or 2.8%, to $53.53, while Valeant Pharmaceuticals acquired Obagi Medical Products for $19.75 in cash per share, and its shares took on $1.76, or 2.4%, to $75.11. Copper rose as May contract gained 3.7 cents to settle at $3.442 U.S. a pound. Teck Resources Ltd. gained 72 cents, or 2.5%, to $29.17. Gold stocks suffered as Barrick Gold went down five cents to $29.59. Alamos gold dipped 34 cents, or 2.3%, to $14.64, on dropping its hostile takeover bid for Aurizon Mines, whose shares were unchanged at $4.48. ON BAYSTREET The TSX Venture Exchange settled 0.54 points to 1,105.97 All but three of the 14 Toronto subgroups stayed in the green by the closing bell, with information technology stocks leading the way, 2.8% higher, while health-care soared 1.5%, and metals and mining surged 1.3%. The three laggards were gold, down 0.6%, financials, slipping 0.03%, and materials, down 0.02%. ON WALLSTREET U.S. stocks rose Wednesday after the Federal Reserve said it would keep its stimulus policies in place until it sees substantial improvement in the labour market. The Dow Jones Industrials jumped 55.91 points to close at 14,511.70. Shortly after the Fed's announcement, the Dow hit a new intraday record high of 14,546.82. The S&P 500 index was 9.51 points higher to 1,557.85. The tech-heavy NASDAQ Composite strengthened 25.09 points to 3,254.19. All three major indexes are up between 9% and 11% so far this year in a rally that has largely been driven by the Fed's stimulus policies. In corporate news, in corporate news, FedEx widely missed earnings estimates and cut its outlook for the year. The company is often viewed as a bellwether for the broader economy due to the global scope of its business. FedEx also said it may temporarily ground some aircraft. Shares of rival UPS also fell. Shares of Caterpillar sank nearly 2% after the heavy-equipment maker reported a sharp drop in sales to its worldwide network of dealers. BlackBerry shares jumped 7% after analysts at Morgan Stanley upgraded the stock. The company will soon start selling its new Z10 smartphone to U.S. customers. Shares of Lennar rose 5% after the home builder reported better-than-expected earnings. General Mills shares gained after the packaged food company said sales and earnings rose in the most recent quarter. Adobe Systems shares jumped a day after the graphics software maker beat earnings estimates. Shares of Model N surged 36% in the company's stock market debut. The software design company priced its IPO at $15 U.S. per share late Tuesday. Investors have also been monitoring developments out of Cyprus Wednesday after lawmakers voted against a tax on bank deposits, calling a bailout deal into question. Worries about Cyprus sparked a choppy trading day Tuesday, with U.S. stocks ending mixed. Banks in Cyprus will remain closed through Friday, after depositors rushed to withdraw cash from ATMs earlier in the week. But investors have been increasingly calm about the prospect of financial contagion spreading from the tiny island nation to larger economies in the euro area. Economically speaking, in its latest policy statement, the central bank reiterated plans to continue buying $85 billion U.S. worth of Treasuries and mortgage-backed securities to help "make broader financial conditions more accommodative." The Fed also lowered the upper end of its forecast for economic growth for this year. It said U.S. gross domestic product will increase between 2.3% and 2.8% in 2013. In December, the Fed had projected a growth rate between 2.3% and 3%. Prices on the 10-year U.S. Treasury slipped, raising yields to 1.94% from Tuesday’s 1.91%. Treasury prices and yields move in opposite directions. Oil prices moved $1.08 higher to $93.24 U.S. a barrel. Gold prices dipped $4.50 to $1,606.80 U.S. an ounce.
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