TORONTO - The Toronto stock market headed for a strong advance Thursday morning ahead of a much-anticipated news conference by the president of the European Central Bank.
Mario Draghi was expected to lay out details of a bond buying program that would help alleviate higher borrowing costs that have squeezed the most vulnerable members of the eurozone, including Spain and Italy.
The worry is that those countries could be forced to seek a bailout without some way to reduce the interest rates on the bonds they sell, following a path taken by Greece, Ireland, Portugal and Cyprus.
Prior to Draghi's announcement, the ECB said that is was leaving its key interest rate unchanged at 0.75 per cent.
The Canadian dollar was up 0.28 of a cent to 101.2 cents US.
U.S. futures were also higher as the Dow Jones industrial futures gained 58 points to 13,108, the Nasdaq futures climbed 12.75 points to 2,780.25 and the S&P 500 futures advanced 6.6 points to 1,410.1.
Expectations for ECB action have been high since Draghi said in July that the bank would do whatever it takes to save the euro currency.
Oil prices were also higher amid hopes that a fix for the eurozone government debt crisis would help get parts of Europe out of recession and improve demand prospects.
The October crude contract on the New York Mercantile Exchange gained $1.12 to US$96.48 a barrel.
December copper declined three cents to US$3.50 a pound, losing half of Wednesday's gains.
But December bullion gained $16.80 to US$1,710.80 an ounce.
Markets also looked ahead to Friday’s release of the August non-farm payrolls report to see if a weak report would persuade the U.S. Federal Reserve to embark on another round of stimulus. Expectations are modest with economists forecasting the economy created only about 127,000 jobs last month.
Canadian employment data will also be released Friday. Statistics Canada is expected to announce the economy cranked out about 11,000 jobs.
European bourses ran ahead with London's FTSE 100 index up 0.6 per cent as the Bank of England announced it would keep its key lending rate at 0.5 per cent and decided not to increase its economic stimulus program of bond purchases.
Britain has been in recession for the last three quarters. The Organization of Economic Co-operation and Development said Thursday it expected British GDP to contract by 0.7 per cent this year.
Frankfurt's DAX gained 1.27 per cent and the Paris CAC 40 was ahead 0.9 per cent.
Earlier in the day, stock markets in Asia wavered before posting modest gains.
Japan’s Nikkei 225 closed marginally higher, Hong Kong’s Hang Seng added 0.3 per cent, South Korea’s Kospi gained 0.4 per cent and Australia’s S&P/ASX 200 rose 0.8 per cent.
Mainland China’s Shanghai Composite Index rose 0.7 per cent while the smaller Shenzhen Composite Index added one per cent.