TSX, loonie soar as oil prices rebound

TORONTO -- The Toronto stock market was solidly ahead Wednesday while the Canadian dollar soared more than a penny against its U.S.

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counterpart as the rollercoaster ride in oil prices continued.

In late-day trading, the loonie was up 1.24 U.S. cents at 72.53 cents US amid general weakness in the greenback against most major currencies and a big rebound in oil prices after two days of heavy losses.

The last time the loonie closed up more than a cent was on Jan. 21, when it gained 1.02 cents, although it almost managed that feat again on Jan. 26, closing up 0.97 of U.S. cent.

Meanwhile, the Toronto Stock Exchange's S&P/TSX composite index added to gains throughout the day and was ahead 141.75 points at 12,584.01 after triple-digit loses the two previous days totalling almost 380 points or three per cent.

In New York, markets were mixed, with the Dow Jones industrial average rebounding sharply from early losses to post a 182.64-point advance to 16,336.18. The broader S&P 500 also shed earlier losses to rise 9.57 points to 1,912.60, while the Nasdaq remained slightly in the red, down 7.64 points at 4,509.31.

Commodities strengthened, with the March contract for benchmark crude oil up $2.41 at US$32.29 a barrel after having fallen $3.74 a barrel over the two previous sessions.

Meanwhile, March natural gas added a penny to US$2.04 per mmBtu, while April gold rose $13.30 to US$1,140.50 a troy ounce and March copper jumped four cents to US$2.10 a pound.

The big bounce in oil prices came despite a report from the U.S. Energy Information Administration showing American commercial crude inventories increase by 7.8 million barrels last week, almost double the four-million-barrel gain forecast by analysts.

At almost 503 million barrels, U.S. crude inventories remain at levels not seen at this time of year in a least 80 years, the EIA said.

In retail news, U.S. home improvement giant Lowe's has made a friendly $3.2 billion takeover offer for Quebec-base Rona Inc. (TSX:RON) that has the support of Rona management and the Caisse de depot, which owns about 17 per cent of the company.

Rona stock was up $11.55 or 98.09 per cent at $23.32 in massive trading of more than 16 million shares.


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