By James Langton
(March 16 – 13:00 ET) – Old economy stocks are rallying hard again today. Techs are offering little resistance allowing the TSE 300 to sit up 100 points at midday to 9,393. Volume is moderate at 109 million shares, but 3:1 in favour of buyers. Advancers are ahead of decliners 11:9 too. The TSE’s gains are coming across all groups with only media stocks in the red, down just 0.24%. Real estate, financials, and merchandisers are all powering ahead strongly, joined by the rocks and trees.
The transports are bouncing particularly high, up more than 7%. Laidlaw is up more than 25% on 12.7 million shares as the struggle over its future continues to play itself out. troubled subsidiary Safety-Kleen has released some initial audit results and has applied for a $20 million credit facility in an effort to deal with its troubles.
The transports are followed by strength in tobacco stocks, oil and gas service companies and the base metal miners. To some extent gas and smokes are popping up on news that their huge price increases are finding their way into economic data, such as this morning’s U.S. Producer Price Index. Stocks such as Ulster Petroleum, Probe Exploration and Dreco Energy Services are trading actively and up.
The financials strength is coming from the banks which are up almost 3% as a group, but Manulife has also jumped 6% in heavy trading.
On the downside only software is falling as a group, down almost 3% again today. Smaller slides are coming in publishers, building materials, cable stocks and biotech. Much of the speculative air continues to leak out of the techs. 724 Solutions is down another 8%, joined by drops in Certicom, Sierra Wireless, Research in Motion, Cognos, Delrina, Descartes Systems and Tundra Semiconductor.
Not all the techs are getting slugged. Ballard Power is recovering some recent losses, up 5%. JDS Uniphase has recovered 2% and Informission Group is up strongly too.
The CDNX has been tentative about joining the TSE’s recovery. It is up just one and a half points at midday to 4,297. Volume has been relatively soft at 45 million shares. Energy stocks are still sliding on the CDNX while the miners and techs are picking up. Petra Resources Corp. is the hottest trader, up 100% on 3.3 million shares.
In New York, a monstrous rally in old economy stocks has convinced even tech traders. The Dow is up an incredible 448 points at midday to 10,577, on its way to its highest ever point gain. The previous high one-day gain is 380 points in September 1998. Upside trading curbs are in. The Nasdaq opened down as much as 100 points but has reversed course in the face of the massive Dow rally and is up 32 points at midday to 4,455. The S&P is up 47 points to 1,439.