TSX Hits another record high just shy of 15,000 - Canadian Commentary

20:45 GMT

May 2008

(RTTNews) - Bay Street finished up a record-smashing week on another high note Friday as surging oil prices fueled strong gains in the energy sector, while a weaker US dollar helped drive gold stocks deep into positive territory.

The S&P/TSX Composite Index extended its all-time high for a second session, jumping 156.14 points to 14,984 and pulling up just shy of the psychologically important 15,000 mark.

Energy stocks soared almost 3 percent, led by Canadian Oil Sands (COS.UN.TO) and Canadian Natural Resources (CNQ.TO).

Crude oil closed above the $126 a barrel mark on Friday and again added to its record levels. Light sweet crude closed at $126.29, up $2.17 on the day. Oil touched a record high of $127.82 in the early going before easing back slightly. Goldman Sachs boosted its forecast to $141 a barrel in the second half of this year.

The Gold Index picked up 2.9 percent. The price of gold rose for the second straight session and moved to its highest level in more than three weeks. June gold closed at $899.90, up $19.90 for the session.

Gold surged higher as the dollar hit the skids against other major currencies on Friday as the release of a report showing that US consumer sentiment dropped to its lowest since 1980 overshadowed a relatively encouraging reading on the housing situation.

The Reuters/University of Michigan Surveys of Consumers said its preliminary index of confidence fell to 59.5 in May, down from 62.6 in April. This was well below economists’ median expectation of a reading of 62.0.

The dreadful consumer confidence reading overshadowed data showing that housing starts unexpectedly showed a significant increase in the month of April, according to a report released by the Department of Commerce. The data is likely to offset some of the recent pessimism about the outlook for the housing market.

Crystallex (KRY.TO) bounced back from steep early losses, saying it will appeal a decision by Venezuela officials denying the the company a permit for its open-pit gold mine in Bolivar state. Shares of Crystallex were unchanged.

Biovail Corp. (BVF.TO) announced that its subsidiary, Biovail Pharmaceuticals, has reached an agreement with the United States Department of Justice in respect of criminal allegations related to activities surrounding the 2003 commercial launch of Cardizem LA. The company said the agreement eliminates any criminal liability for it arising from this matter, and preserves its ability to conduct business in the US. The company will pay $24.6 million to fully settle this matter. Biovail shares rose fractionally.

In the tech sector, Research In Motion (RIM.TO) eased slightly after the Wall Street Journal reported that it will launch a model with a touch screen in the third quarter, to rival Apple’s iPhone.

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Posted in Categories: Releases, Stocks.