A $5.4-billion deal between Encana Corp. and PetroChina Co. gave energy issues a boost Thursday and helped propel the Toronto Stock Exchange to its third gain in four sessions.
The benchmark S&P/TSX composite index rose 56.27 points, or 0.41%, to 13,840.57. Six of the 10 sub-indexes rose, including the big three sectors of energy, materials and financials.
The deal between Encana and Petro-China, announced late Wednesday, gives the Chinese company a 50% stake in a project straddling the British Columbia-Alberta border.
The Encana deal "shows there is still interest officially from the Chinese for our resources," Jennifer Radman, a money manager at Caldwell Investment Management Ltd. in Toronto, told Bloomberg News.
On Thursday, Encana shares rose 4.5% to $32.02 The price of West Texas Intermediate crude oil rose US2¢ to US$86.73 a barrel.
Gold slipped US$2.90 to US$1,361.90.
U.S. markets were mostly lower for the better part of the day despite a report that initial jobless claims last week came in lower than expected, after companies including Cisco Systems and PepsiCo gave profit forecasts that missed estimates.
"While soft guidance from Cisco appears to be taking the brunt of the blame for (Thursday's) declines, the much more telling sign that the rally may be done is that markets have failed to advance on good news," analyst Colin Cieszynski of CMCMarkets wrote in an afternoon note.
The Dow Jones industrial average slipped 10.60 points, or 0.09%, to 12,229.29, and the Nasdaq eked out a gain, rising 1.38 points, or 0.05%, to 2,790.45.
Canada's junior Venture exchange fell 5.95 points, or 0.25%, to 2,347.82.
A number of big Canadian companies reported earnings that missed estimates Thursday, including Manulife Financial, which dropped 5.1% to $17.95, and Canadian Tire, which was down 2.6% to $64.75. BCE Inc. fell 1.2% to $36.14 and Air Canada was down 0.9% to $3.39
Flight simulator company CAE Inc. reported earnings that matched estimates, excluding some items, but its shares fell 3.1% to $12.74 after several analysts cut their ratings on the shares.
Other energy companies showing gains Thursday included Progress Energy Resources, another large landholder in the area involving the Encana/Petro-China deal, which gained 8.4%, or $1.12, to $14.43, trading on almost six times its normal trading volume.
Cenovus Energy rose 2.9% to $34.80 and Canadian Natural Resources was up 1.8% to $44.22.
