Bargain hunters boost stocks

www.canoe.ca Saturday, February 15, 2003 By MALCOLM MORRISON, CP

TORONTO -- Stocks finished higher yesterday as investors swooped to buy beaten-down shares in what's perceived to be an oversold market amid uncertainty about what will happen next with the Iraqi crisis. The Canadian dollar closed at 65.66 cents US, down 0.23 after a half-cent gain, and gold fell $5.70 to $351.30 US an ounce in New York. Stock markets took heart from a relatively positive assessment of Iraqi compliance from chief United Nations chief weapons inspector Hans Blix, who said yesterday UN inspectors haven't found any weapons of mass destruction. On the other hand, Blix said, many banned military materials remain unaccounted for and U.S. Secretary of State Colin Powell asserted "the threat of force must remain" -- causing markets to initially give up their early gains. Still, the Dow industrial average was up 158.93 points to 7,908.8 late in the day. The blue-chip barometer edged up 44 points on the week. The Nasdaq was ahead 32.73 at 1,310.17 for a gain of 27.7 points this week and the S&P 500 index rose 17.52 to 834.89. Gains in information technology helped balance weakness in the gold sector to give the S&P/TSX index a gain of 34 points to 6,487.13, adding 9.39 points this week. The junior TSX Venture Exchange was up 8.36 at 1,095.49. On the Toronto Stock Exchange, Nortel Networks advanced 11 cents to $3.53. The financial sector was also stronger as Royal Bank rose $1.30 to $56. The gold sector fell 2.6 per cent. Barrick Gold lost 87 cents to $24. Crude oil futures edged up 44 cents to a 29-month high of $36.80 US a barrel on the New York Mercantile Exchange. Crude prices have been pushed up by the Iraqi crisis and a general strike in Venezuela, another major petroleum producer. Analysts were doubtful the gains of the session would stick since the Blix report didn't convince markets that war would be averted. "The running assumption in the markets right now is there will be a war, it will happen -- happen very quickly -- and the second half of the year will be very strong," said Mark Chandler, financial markets economist at Scotiabank. The U.S. market was supported by a solid earnings report Thursday from Dell Computer. The No. 2 maker of personal computers reported record fourth-quarter sales and a profit of $603 million US, up 32 per cent. Its shares rose $2.54 to $25.77 US. In economic data, American industrial production rose 0.7 per cent in January after a 0.4 per cent drop in December. But the University of Michigan consumer confidence index fell to 79.2 for February, its lowest level since September 1993. A reading of 82.5 had been expected. Analysts said the confidence number had little effect on the markets, perhaps because previous swings in the index have not been reflected in consumer spending. "What they tell the polls is very different from what they do at the shopping mall," said Patricia Croft, managing partner at Sceptre Investment. "So I pay more attention to what they do than what they say." On the Toronto market, advances beat declines 545 to 496 with 225 unchanged. Active Toronto stocks included ATI Technologies, ahead 27 cents at $6.43, Bombardier, up 15 cents to $5, and Inco, down 47 cents to $31.43. Toronto volume was 143.8 million shares worth $1.61 billion. The Nasdaq Canada index was up 2.31 points to 222.25.