TORONTO - The Toronto stock market surged for a second day Wednesday in another broad advance led by beaten-down Canadian banks and insurance companies.
New York traders turned cautious, after the previous session's furious buying which had been prompted by news that Citigroup Inc. earned an operating profit in the first two months of the year.
Toronto's S&P/TSX composite index closed up 130.61 points to 8,011.02, after a 12 per cent surge in financials pushed the benchmark index up 313 points on Tuesday, the market's best day so far this year.
The TSX Venture Exchange ticked 5.35 points higher to 823.9.
The Canadian dollar fell 0.06 of a cent to 77.75 cents US.
New York's Dow Jones industrial average edged up 3.91 points to 6,930.40 after charging ahead 379 points the day before.
The Nasdaq composite index gained 13.36 to 1,371.64, supported by Apple Inc. after the company unveiled a new iPod Shuffle about half the size of the previous version but with double the music capacity. Apple shares climbed $4.05 to US$92.68.
The S&P 500 rose 1.76 points to 721.36.
Citigroup gained another nine cents to US$1.54 after surging 38 per cent Tuesday and energizing financial stocks, which have been languishing under a run of bad news including the US$62-billion loss reported last week by insurer American International Group Inc.
The big question Wednesday was whether the market could hold on to Tuesday's gains.
"Earnings are still going down; there's nothing on the horizon that says this thing is going to turn, even flatten for a while," said Adrian Mastracci, portfolio manager at KCM Wealth Management in Vancouver.
"One day doesn't make a long-term view here, or two days."
Mastracci said he takes advantage of rallies to sell unwanted stocks.
"I love days like yesterday because it gives me a chance to clean out the cupboard. There's some cobwebs in there -- some of the new clients have some stuff that shouldn't be there."
Adding to opinion that the Toronto market is in for more down days was CIBC World Markets chief strategist Jeff Rubin.
He sees the main index in Toronto hitting 7,000 before fiscal stimulus and financial rescue packages make a big difference.
"Even with a second-half economic recovery, it is hard to see the TSX beyond 9,000 at year-end," said Rubin.
The TSX financial sector was up 2.2 per cent on the day as TD Bank (TSX:TD) rose $1.26 to $39.76 and Royal Bank (TSX:RY) gained 63 cents to $33.57.
Bank of Montreal (TSX:BMO) improved 39 cents to $30.10 as it announced a $200-million preferred share issue paying 6.5 per cent.
The energy sector backed off 0.4 per cent following the U.S. Department of Energy report that crude supplies climbed by 700,000 barrels last week against an expected drop of one million barrels. Petro-Canada (TSX:PCA) gained 92 cents to $28.81 but Canadian Natural Resources (TSX:CNQ) shed $1.11 to $44.89.
The April crude contract in New York moved down $3.38 to US$42.33 a barrel.
The gold sector was up six per cent as the April bullion contract on the Nymex rose $14.80 to US$910.70 an ounce. Goldcorp Inc. (TSX:G) climbed $2.01 to C$36.
Base metal stocks also made headway with Teck Cominco Ltd. (TSX:TCK.B) ahead 51 cents to $4.60 and FNX Mining (TSX:FNX) advancing 25 cents to $3.88.
Bombardier Inc. (TSX:BBD.B) climbed 12 cents to $2.71 after it finalized a sale of 30 new CS100 jets for US$1.5 billion to Germany's Lufthansa.
Shares in travel operator Transat A.T. Inc. (TSX:TRZ.B) fell 75 cents to $6.85 after a sharp increase in its quarterly loss and suspension of its dividend to conserve cash during the global economic slump. The Montreal-based company lost $29.4 million on the quarter, compared with $7.9 million a year earlier.
