TORONTO - An improvement in the financial sector pushed the Toronto stock market into positive territory mid-morning Wednesday following bruising losses the day before.
New York markets were higher with investors encouraged by better-than-expected quarterly earnings from IBM Corp.
Toronto's S&P/TSX composite index advanced 52.8 points to 8,557.8 after a new round of worries surrounding the financial sector pushed the main index to a 337-point loss.
The TSX Venture Exchange dipped 1.29 points to 855.39 while the Canadian dollar rose 0.32 cent to 79.21 cents US.
Further signs of economic weakness surfaced as Statistics Canada reported that wholesale sales fell 1.6 per cent in November to $44.4 billion as decreases in four of seven sectors contributed to the third decline in four months.
New York's Dow Jones industrials gained 143.4 points to 8,092.5 after tumbling 332 points.
The Nasdaq composite index climbed 30.07 points to 1,470.93 following an 88-point plunge while the S&P 500 clawed back some of Tuesday's 45-point loss, rising 15.9 points to 821.1.
Technology bellwether IBM Corp. said after the close that its fourth-quarter profit jumped 12 per cent to US$4.4 billion, or $3.28 per share. Analysts were expecting IBM to earn $3.03 per share this time.
It also provided a better-than-expected profit outlook for 2009 of US$9.20 per share this year -- 45 cents per share better than the average analyst estimate and its shares headed up $7.04 to $89.02.
Swedish wireless equipment maker LM Ericsson also reported better-than-expected fourth-quarter profit, although earnings fell by 31 per cent.
Sales figures showed that GM has lost its spot as the world's largest automaker. The U.S. automaker's 2008 sales came in a 8.35 million units, down 11 per cent from 2007, while Toyota's group sales totalled 8.97 million, down four per cent.
The news came hours after General Motors Corp.'s chief operating officer said the automaker will run out of cash long before the end of the first quarter if it doesn't get the second instalment of government loan money that was due Jan. 16.
"If we don't get our second instalment of the funding we'll run out of cash, it's that's simple," said Fritz Henderson.
GM shares were off seven cents to US$3.43.
Earnings reports will continue to be the market's focus Wednesday, as they will for the next few weeks. Apple Inc. is set to report its fourth-quarter earnings after the market closes, and major airline operators UAL Corp. and AMR Corp. are also scheduled to release results.
"I think (earnings are) going to be bad. That's expected," said Rob Lutts, president and chief investment officer, of Cabot Money Management.
"The key will be guidance. IBM was pretty confident. The more we see that, the better, but I think many will be conservative."
The financial sector was ahead 0.65 per cent, with TD Bank (TSX:TD) ahead 51 cents to $39.93.
In New York, shares of U.S. Bancorp were down $2.05 to $13.29 after the bank reported a 72 per cent drop in earnings to US$260 million or 15 cents a share in the final three months of last year as credit costs and securities losses climbed. Analysts had expected earnings of 22 cents a share.
The TSX energy sector was ahead 1.35 per cent as the March crude contract on the New York Mercantile Exchange added $1.15 to US$41.99 a barrel. Suncor Inc. (TSX:SU) improved $1.29 to $23.39.
Precision Drilling Trust (TSX:PD.UN) units were off two cents at $7.50 after the company said it is cutting its cash distribution for January to four cents a unit from the 13 cents paid out in December. The company said the reduction reflects "a sharp reduction in United States rig demand resulting from the steep decline in energy commodity prices over the past three months."
The base metals sector was mixed as mining giant BHP Billiton announced plans to slash 6,000 jobs, or about six per cent of its global work force, as it rushes to cope with plummeting demand because of the global financial crisis.
Teck Cominco Ltd. (TSX:TCK.B) declined 14 cents to $5.45 but Sherritt International (TSX:S) rose five cents to $3.74.
The gold sector dipped 1.3 per cent as the February bullion contract in New York faded $6.10 to US$849.10.
Kinross Gold Corp. (TSX:K) shares were down $1.38 to $21.73 after the company said it plans to raise up to US$360.5 million through an issue of 20.9 million common shares at a price of $17.25 a share.
Consumer discretionary stocks were also a drag as Canadian Tire (TSX:CTC.A) fell $1.50 to $40.50 while auto parts giant Magna International (TSX:MG.A) gave back 81 cents to $35.82.
Shares in Saskatchewan-based grain handler and farm supplier (TSX:VT) Viterra Inc. climbed 81 cents or almost 10 per cent to $9.01 even as it said it expects its pension expenses will be substantially higher this year and it will need to take a writedown on its fertilizer inventory. The Regina-based company, created after the merger of Saskatchewan Wheat Pool and Agricore United, earned $288.3 million for the 12 months ended Oct. 31 and had sales of nearly $6.8 billion.
Overseas, Japan's Nikkei stock average fell two per cent while Hong Kong's Hang Seng Index shed 2.9 per cent as concern that rising bank losses will cripple the world economy overshadowed the inauguration of U.S. President Barack Obama. European markets tracked Asia lower.
Britain's FTSE 100 was flat, Germany's DAX index rose 1.1 per cent, and France's CAC-40 was up 0.55 per cent.
