The Toronto stock market closed higher Wednesday as buyers hoped that the European Central Bank would unveil measures to help contain the eurozone debt crisis.
The S&P/TSX composite index rose 48.44 points to 11,990.14, led by financial and mining stocks, while copper prices advanced for a third day, while the TSX Venture Exchange added 3.69 points to 1,246.27.
The Canadian dollar was lower ahead of the European Central Bank announcement and Canadian jobs data, which also come out Friday, falling US0.52¢ at US100.92¢.
As expected, the Bank of Canada left its benchmark interest rate unchanged at 1% while warning that rates will have to rise at some point in the future. The central bank also said there has been a widespread slowing of activity across most economies. The loonie seemed unaffected by Tuesday's Quebec election which was won by the pro-independence Parti Quebecois with a minority government.
New York markets were little changed. The Dow Jones industrials were up 11.54 points to 13,047.48, the Nasdaq composite index was down 5.79 points to 3,069.27 and the S&P 500 index eased 1.50 points to 1,403.44.
Traders anxiously awaited Thursday's interest-rate announcement from the ECB amid hopes it will move to ease the eurozone debt crisis by addressing the high borrowing costs that have bedevilled some of the weakest members of the monetary union, particularly Spain. It is expected some sort of bond-buying program will be announced but it would come with strings attached.
To be eligible for the central bank's help, for example, countries would probably have to formally apply for assistance from the eurozone's rescue facility and accept conditions on their budget policies, which many governments would be reluctant to do.
"The best thing we can hope for is the European Central Bank to get its firepower all lined up and try to cap rates and do that in a way that doesn't stoke inflation and allows time to pass and finances to get a bit healthier," said Paul Vaillancourt, vicepresident and chief investment officer at Canadian Wealth Management. "In times of crisis, sometimes the best you can expect is do no harm."
Investor sentiment improved somewhat as Bloomberg News reported European Central Bank President Mario Draghi's bond-buying program involves unlimited purchases of government debt.
Europe's economy also remains fundamentally weak. A survey of the eurozone's services sector Wednesday showed the sector continued to contract in August.
