Canadian stocks may struggle to maintain positive momentum from late in the previous session Wednesday morning as investors continued to weigh a slew of earnings results the Bank of Canada's surprise interest rate cut.
The S&P/TSX Composite Index rose 121.02 points or 1.32% to end at 9,247.17, led by a strong performance from the mining sector. Heavily-weighted financial and energy stocks also boosted the market higher.
Banks were bolstered by comments from US Treasury Secretary Tim Geithner, but dismal results from US credit card issuer Capital One could stoke concerns about the health of the financial sector.
Geithner assured the Congressional Oversight Panel that there is enough money left in the government's $700 billion financial rescue program to stabilize the financial system. Geithner said there is at least $134.4 billion in funds left.
The Treasury Secretary also said that the vast majority of U.S. banks have enough capital and hinted that the credit markets may be thawing following their deep freeze.
In earnings news from the oil patch, Precision Drilling Trust (PD_U.TO) reported first quarter net earnings of C$57.42 million or C$0.30 per diluted unit, a decrease of C$49 million or 46%, compared to C$106.27 million or C$0.84 per diluted unit in the prior year quarter.
Revenue for the quarter grew to C$448.45 million from C$342.69 million in the prior-year quarter.
EnCana Corp. (ECA, ECA.TO) announced that its first quarter net earnings increased to US$962 million or US$1.28 per share, from US$93 million or US$0.12 per share in the year ago quarter.
Operating earnings for the quarter was US$948 million or US$1.26 per share, compared to US$1.05 billion or US$1.39 per share in the year ago quarter.
Aastra Technologies Ltd. (AAH.TO) reported Tuesday first quarter earnings that improved significantly to $14.1 million or $1.02 per share, compared to $5.3 million or $0.33 per share in the same period in last year.
On the economic front, Canada's composite leading index fell 1.3% in March following a 1.4% drop in February, according to data released Wednesday morning. The data comes on the heels of Tuesday's surprise interest rate cut by the Bank of Canada.
The contraction in the manufacturing sector intensified as widespread cutbacks were implemented in the auto industry early in the new year. This was offset by a marked slowdown in the fall of the housing and stock markets.
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