By Warangkana Chomchuen
SAN FRANCISCO (MarketWatch) — Canadian stocks extended gains on Thursday as favorable economic data abroad and corporate earnings at home supported investors’ risk appetite.
The S&P/TSX Composite Index added 30.02 points, or 0.2%, to close at 12,731.28.
Investors embraced news that U.S. unemployment claims remained unchanged last week, signaling improvements in the U.S. job market while company earnings also supported the Canadian benchmark, said Peter Buchanan, economist at CIBC World Markets.
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Buchanan also noted that dividend announcements in the fourth quarter showed a rate increase of about 31%, the highest level in the past six years.
“It’s a sign that companies are cautiously optimistic and becoming more confident that the growths are going to be sustained,” Buchanan said.
SXC Health Solutions Corp. jumped 5.9%. The pharmacy benefits manager reported a 60% jump in quarterly profit and said it predicted this year’s revenue to grow 38%.
Tim Hortons Inc. was up 3.6% after the coffee and doughnut chain company raised its quarterly dividend by 24%, although its fourth-quarter profit fell by 73%.
Pan American Silver Corp. closed up 2.5%. The Vancouver-based gold and silver miner raised its dividend by 50% as the fourth-quarter profit and sales jumped.
Yamana Gold Inc. /zigman2/quotes/206359073/delayed CA:YRI -1.04% advanced 3.1%, one of the best among large caps.
Still, the Canadian stock index was pressured by a 1.8% loss in the consumer staples sector, with shares of Loblaw Cos Ltd. /zigman2/quotes/205942785/delayed CA:L +2.14% sliding 5.7%.
The Montreal-based supermarket retail chain, Metro Inc. /zigman2/quotes/207739858/delayed CA:MRU -0.04% , dipped 2.1%.
The U.S. initial unemployment claims stayed unchanged last week at a seasonally adjusted 351,000. The four-week average of claims fell by 7,000 to 359,000, the lowest level since March 2008. Read about U.S. jobless claims
In Canada, the average weekly earnings of nonfarm payroll employees rose 0.7% in December, while earnings on a year-on-year basis were up 2.4%, according to Statistics Canada.
Separately, the agency also said operating profits of Canadian corporations rose 9% in the fourth quarter.