The United People’s Freedom Alliance (UPFA) and the Sri Lanka Freedom Party (SLFP) say they are ready to form their own Government.The UPFA and SLFP have written to President Maithripala Sirisena calling for the appointment of a new Prime Minister.
TORONTO – The Toronto stock market closed higher after the U.S. Federal Reserve delivered on expectations for more help keeping the fragile economic recovery going.The S&P/TSX composite index jumped 127.54 points to 12,360.16 after the U.S. Federal Reserve said it will spend $40 billion a month on a new round of bond purchases to boost the weak economy, and has not set an end date.The money will be spent on mortgage backed securities to keep interest rates low, encourage lending and support the slow recovery of the housing sector.The bank will also continue to buy long bonds under its so-called twist program, leaving them buying a total of US$85 billion per month for the balance of the year under the two programs.The Fed also says it will keep buying more bonds until the job market shows substantial improvement.That could take awhile as the Fed also has lowered its outlook for growth this year, saying growth will be no stronger than two per cent this year, down from a 2.4 per cent forecast in June.However, it also expects growth to accelerate next year as much as three per cent, up from June’s forecast of as much as 2.8 per cent. For 2014, the Fed projected growth between three and 3.8 per cent.“The question is, how much of an effect it’s eventually going to have but right now everybody is buying it,” said John Johnston, chief strategist at Davis Rea Ltd.“It’s not going to have a huge impact on the economy but it will certainly have a big impact on the markets.”The TSX Venture Exchange climbed 20.25 points to 1,302.89.New York markets shot higher to multi-year highs with the Dow Jones industrials up 206.51 points to 13,539.86.The Nasdaq composite index jumped 41.52 points to 3,155.83, and the S&P 500 index was 23.43 points higher to 1,459.99.The Canadian dollar gained 0.87 of a cent to a fresh 13-month high of 103.27 cents US in the wake of the Fed announcement.The stimulus program involves quantitative easing, which sees the central bank print more money to fund the bond purchases, which in turn weakens the currency.The loonie has surged in value against the U.S. dollar since last week, up 2.35 cents since last Wednesday, after European Central Bank president Mario Draghi announced the ECB would buy government bonds to hold borrowing costs down the most vulnerable eurozone members. And the greenback further weakened over the last week as speculation grew the Fed was prepared to launch a third round of stimulus, particularly after August job creation figures disappointed even modest expectations.The Fed left interest rates near zero and said rates wouldn’t budge until mid-2015 at the earliest.In two previous bond-buying programs, the Fed bought more than US$2 trillion of Treasurys and mortgage-backed securities after the 2008 financial crisis.At a later news conference, Fed chairman Ben Bernanke said the bank doesn’t have a particular number in mind for the unemployment rate to fall to before ending this round of stimulus.He said the Fed is looking for a sustained improvement in the labour market, and it hasn’t seen that yet.The gold sector led TSX gainers, up almost four per cent as December bullion gained $38.40 to US$1,772.10 an ounce as buyers bought into the precious metal as a hedge against inflation. Barrick Gold Corp. (TSX:ABX) was up $1.57 to C$40.32 while Goldcorp Inc. (TSX:G) jumped $1.99 to $44.The base metals sector rose 2.5 per cent with December copper ahead two cents at US$3.71 a pound. Teck Resources (TSX:TCK.B) rose 82 cents to C$31.44 and First Quantum Minerals (TSX:FM) climbed 70 cents to $22.78.The energy segment was up 1.5 per cent while the October crude contract on the New York Mercantile Exchange closed up $1.30 to US$98.31. Prices advanced after attacks on U.S. diplomatic missions and the killing of the U.S. ambassador to Libya sparked new worries about unrest in the Middle East. Canadian Natural Resources (TSX:CNQ) advanced 86 cents to $32.82 and Cenovus Energy (TSX:CVE) gained 88 cents to C$34.97.The TSX financial sector also provided lift to the market as Manulife Financial (TSX:MFC) gained 56 cents to $12.14 while Sun Life Financial (TSX:SLF) was up 56 cents to $23.63.The tech sector led decliners.The U.S. Department of Justice is asking satellite technology company MacDonald, Dettwiler and Associates Ltd. (TSX: MDA) to shed some more light on its US$875-million takeover bid for California-based Space Systems/Loral Inc. The deal, which the company has called “a game changer” will boost MacDonald, Dettwiler’s role as a supplier of commercial communications satellites. MacDonald, Dettwiler shares lost $3.17 or 5.89 per cent to $50.65 on top of a seven per cent slide on Wednesday.In other corporate news, shares in travel company Transat AT Inc. (TSX:TRZ.B) surged 91 cents or 22.8 per cent to $4.90 as it reported quarterly profit of $9.4 million or 25 cents a share, compared to a year ago loss of $2.8 million. Revenue was down three per cent from a year earlier to $909.1 million.Empire Company Ltd. (TSX:EMP.A) says its first-quarter profit rose to $108.9 million or $1.60 per share, up from $89.2 million or $1.31 per share a year earlier. The Nova Scotia-based company is best known for its Sobeys grocery stores but it also is involved in other retail operations, movie theatres and real estate. Revenue for the company was up 9.7 per cent to $4.56 billion, thanks in part to the acquisition of 236 retail gas locations and convenience stores and its shares gained 47 cents to $58.05. AddThis Sharing ButtonsShare to TwitterTwitterShare to FacebookFacebookShare to RedditRedditShare to 電子郵件Email by Malcolm Morrison, The Canadian Press Posted Sep 13, 2012 4:30 pm MDT TSX advances as U.S. Federal Reserve commits to further stimulus measures