TORONTO – The Toronto stock market opened higher Wednesday as investors took in stronger than expected inflation data and news that Greek parliament has passed a tough austerity bill.
The S&P/TSX composite index added 48.61 points to 13,155.08. The TSX Venture Exchange was up 6.56 points at 1,872.24.
The Canadian dollar rose 0.93 of a cent against the U.S dollar at 102.69 cents.
Statistics Canada report that the country’s annual inflation rate jumped to the highest level in eight years last month, rising to 3.7 per cent as big increases in gasoline prices pushed the index to a new post-recession peak.
On a month-to-month basis, consumer prices rose by a significant 0.7 per cent in May from where they were in April.
The surprisingly strong results present Bank of Canada governors with a dilemma less than three weeks before their meeting to set short-term interest rates for the country.
The bank had warned it expected inflation to push above three per cent during the spring, but few expected it would hit such elevated levels. It has now been above three per cent for three consecutive months.
Investors also took in news that Greece’s lawmakers have approved a key austerity bill, paving the way for the country to get its next vital bailout loans that will prevent it from defaulting next month.
The unpopular euro28 billion (US$40 billion) five-year package of spending cuts and tax hikes was backed by a majority of the 300-member parliament Wednesday, including Socialist deputy Alexandros Athanassiadis, who had previously vowed to vote against.
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The European Union and International Monetary Fund have demanded the austerity measures pass before they approve the release of a euro12 billion loan instalment from last year’s rescue package.
Without those funds, Greece would be facing a default by the middle of July.
Commodity traders appeared upbeat about the Greek debt situation and its impact on the global recovery.
Oil for August delivery added 50 cents to $93.38 on the New York Mercantile Exchange. The August gold contract gained $7.30 to $1,507.50, while copper prices rose eight cents to $4.17.
Wall Street markets also moved higher with the Dow Jones industrial average up 26.3 points to 12,215. The Nasdaq gained 10.75 points to 2,294.75 and the S&P 500 index was up 4.4 points to 1,301.05.
In corporate news, Shaw Communications Inc. (TSX:SJR.B) third-quarter profits rose to $203 million, or 45 cents per share, compared to a profit of $158 million or 37 cents per share in the same period a year earlier. Operating revenue rose 36 per cent to $1.28 billion from $943.6 million.
Shares gained seven cents to $21.33.
Yellow Media Inc. (TSX:YLO) says it has received government approval for the $745-million sale of the Trader Corp. auto sales directory business to London-based private equity firm Apax Partners for $745 million. Its stock has been falling on concerns over the company’s transition from print to digital. Shares added six per cent or 14 cents to $2.42.
Niko Resources Ltd. (TSX:NKO), which has recently been the centre of a bribery case with a Bangladeshi government official, fourth-quarter net income tumbled to US$649,000, or 77 cents per share. That’s down from a profit of $38.7 million or 41 cents per share in the same period a year earlier. Shares fell 1.6 per cent or $10.01 to $60.39.
Patent specialist Wi-LAN Inc. (TSX:WIN) has acquired 60 U.S. mobile phone patents and foreign counterparts for $8 million from Glenayre Electronics Inc., the Ottawa-based company announced Wednesday. Shares gained 30 cents to $7.45 apiece.
In Europe, the FTSE 100 index of leading British shares was up 1.1 per cent, while France’s CAC-40 rose 1.6 per cent. Germany’s DAX gained 1.5 per cent.
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