Stocks are rallying aggressively Thursday after the a drop in initial jobless claims in the U.S. cheered traders. At midday, the S&P/TSX composite index is up 76 points to 7,307.

Volume is strong at 123 million shares, with the buying well ahead of the selling by a 19:5 margin. Market breadth is also strongly bullish, with winners outnumbering losers 29:19.

The gains are coming across all sectors on the hope that a strong U.S. recovery would power the Canadian economy and corporate profits, too. The strongest groups are core businesses such as industrials, diversifieds and materials. But everything else is up too, with financials quite strong, and gains coming in consumer plays, energy and techs and telecoms.

They might not be making the biggest percentage gains, but it’s the banks that are driving the rally due to their heavy weight in the market. TD Bank is leading the way, up almost 2% in active trading. CIBC is up 1.2%, as is Manulife Financial. And, there are gains in Scotiabank, Royal Bank and Great-West Lifeco.

Takeover players, Alcan, is powering the metals higher. It is gaining another 2.3% in strong trading.

Placer Dome is leading the gold group higher, and Nortel is leading the techs up with a 3.4% gain in active trading.

Energy stocks are enjoying gains due to strong trading in names such as First Calgary Petroleums, Major Drilling and Canadian Superior Energy. There is also some news in the group supporting specific stocks.

Resolute Energy is up 15% on news that it has closed the sale of the shares of its Indonesian subsidiary, Equatorial Energy (Indonesia) Inc., for US$18 million in cash. Proceeds from the sale will be used to pay down debt. And, Husky Energy is up 4% on news that it reported net earnings of $427 million in the second quarter of 2003, compared with $263 million in the second quarter of 2002.

News is also driving a big 21% jump in the stock of Bioscrypt. The security tech firm seems to be benefiting from the reaction to yesterday’s shooting in New York’s city hall, as it announced that Los Angeles’s City Hall building has been secured with Bioscrypt fingerprint readers to restrict access to the mayor’s office and city council chambers.

There are also gains in biotechs such as QLT, Cardiome Pharma and Aastra Technologies. But, TLC is weaker.

Dynatec is up 6% after it released some preliminary assay results.

Miramar Mining is down almost 6% on news that it has entered into an agreement with a syndicate of underwriters led by BMO Nesbitt Burns Inc. under which the underwriters have agreed to buy 14.3 million common shares from Miramar for $30 million.

Celestica is 3% lower on news that its net loss for the second quarter was $39.6 million, compared with net earnings of $40.4 million for the same period last year. The losses were attributable to lower year-over-year revenues and a $21.6 million charge associated with the company’s restructuring activities.

There are also pullbacks evident in CoolBrands International, Golden Star Resources, and Finning.

In other earnings news, Fairmont Hotels & Resorts recorded second quarter earnings of US$40.1 million. The hotel firm also cut its forecasts, blaming SARS.

TransAlta reported that its earnings slipped to $29.1 million in the second quarter, down from $127.3 million in second quarter of 2002. Although last year’s results included an asset sale gain.

Canadian Utilities reportedly earned $51.9 million in the second quarter.

Atco said that its earnings rose to $51.6 million in the quarter.

Eldorado Gold saw its earnings fall to US$1.8 million last quarter.

Quebecor World saw a $62 million loss in its second quarter and announced 1,000 job cuts.

Pivotal reported that its loss was cut to US$27.7 million in 2003. Its net loss for the fourth quarter was $2.9 million, compared with a net loss of $4.3 million in the prior quarter, and a net loss of $7 million in the same quarter last year.

AEterna Laboratories reported that it has raised $35.6 million in a bought deal with an underwriting syndicate led by RBC Capital Markets, and including National Bank Financial Inc., Paradigm Capital Inc., Desjardins Securities Inc. and Loewen, Ondaatje, McCutcheon Ltd.

In New York, stocks are also heading higher on a mix of economic and corporate news. The Dow Jones industrial average is 50 points higher at 9,245. The Nasdaq composite index has gained 14 ticks to 1,733. The S&P 500 is up six ticks to 995.