TSX hits near-11 month high
(Jack Boland/QMI Agency File Photo)
TORONTO - Canada's main stock index hit a near 11-month high on Monday, led by a jump in Research In Motion Ltd shares following a report that it could license its software.
RIM shares rose 15% to $18.12 after its chief executive told a German newspaper the company will explore strategic alliances with other technology companies once it has launched its new BlackBerry 10 models.
The BlackBerry maker is inching closer to the much-anticipated launch of the BB10 product lineup, which the company hopes will revive its fortunes. The stock, at a 13-month high, has almost tripled since hitting a low of $6.10 in September.
"There's a lot riding on Research in Motion. It is really up to RIM to show investors what it has, that it can come back as a viable competitor to Samsung and Apple devices," said Serge Pepin, vice president of investment strategy at BMO Asset Management Canada.
"There are definitely a lot of expectations. RIM cannot miss anything at this point," he added.
Canadian stocks also benefited from news on Friday that U.S. House Republican leaders said they would seek to pass a three-month extension of federal borrowing authority in the coming days to buy time for the Democrat-controlled Senate to pass a plan to shrink budget deficits.
"In the fullness of time, most people believe that this is going to get resolved one way or the other," said Rick Hutcheon, president and chief operating officer at RKH Investments.
"The only real issue is how much angst do we have to get through along the way. But it will get fixed."
At midafternoon, the Toronto Stock Exchange's S&P/TSX composite index was up 53.50 points, or 0.42%, at 12,779.19, after touching 12,781.89, its highest since Feb. 29, 2012.
"The spread between the 50- and 200-day moving averages has increased. That's a bullish indicator that this rally should continue, notwithstanding a bump or two as we get closer to the real debt ceiling debate," Pepin said.
Eight of the 10 main sectors on the index were trading higher.
The financial sector, the weightiest on the index, rose 0.7% and played the biggest role of any single sector in leading the market higher. Royal Bank of Canada gained 0.6% to $62.11 and Bank of Nova Scotia added 0.8% to $58.33.
The information technology sector was up 3.6%, boosted by RIM's surge.
In other company news, Rona Inc named a new executive chairman and reshuffled its board of directors on Monday, after reaching an agreement with its largest shareholders, who have been calling for changes. Shares of theCanadian hardware retailer and distributor climbed 3.1% to $11.86.