Source: The Canadian Press

The Toronto stock market closed little changed on the final day of 2010, as mining stocks benefited from record high copper prices.

The S&P/TSX composite index gained 8.81 points to 13,443.22 with most other sectors negative, adding up to a solid double-digit gain on the year.

“I would call it pleasantly surprising,” said Gareth Watson, director, Canadian equities portfolio advisory group at Scotia Capital.

“My expectation was that returns for the TSX this year would have been high single digits and we’re looking now at double digit, over 14%, (which) from that perspective, exceeded my expectations for the year.”

The TSX Venture Exchange rose 26.16 points to 2,287.85 for a surge of 767 points or 50.4% this past year.

The Canadian dollar closed above parity against the American currency, up 0.54 to 100.54 cents U.S., its highest close since May 2008.

The TSX ended 2010 up 1,697.11 points or 14.45%, led by a 47% surge in the base metals sector. The surge reflected a 33% rise in the price of copper, on demand from China and other emerging markets.

And analysts think that continued strength from emerging markets is the source of potential weakness for the TSX in 2011.

“A lot of this speculation out there in commodities is being based off the fact that these emerging markets will continue to grow quite well,” added Watson.

“The world is focused on China. I know, we throw in India and Brazil but right now the market says China, commodities, they’re inter-connected in terms of where North American investors are pricing equities and that is the wildcard for the Canadian market.”

New York markets were mixed Friday as the Dow Jones industrial average edged 7.8 points higher to 11,577.51.

The Nasdaq composite index was down 10.11 points to 2,652.87 while the S&P 500 index dipped 0.24 of a point to 1,257.64.

The Dow Jones industrial average gained 11% in 2010, the Standard & Poor’s 500 finished up 12.78% while the Nasdaq composite index finished up 16.9%.

The Toronto gold sector was ahead about 26% for 2010 as the precious metal smashed through record highs a number of times during 2010 as investors looked for a safe haven amid inflation worries and a hedge against weaker currencies.

The energy sector advanced about 8.6% as oil prices ran ahead 15%, while the other big weighting on the TSX, the financials group, finished the year up 4.4%.

The tech sector was up 4.7% while shares in sector leader Research In Motion Ltd. (TSX:RIM) fell about 18% as investors worried about competition from other devices including Apple’s iPhone.

On Friday, the base metals group climbed 0.4% as copper prices moved further into record territory as the March contract on the New York Mercantile Exchange rose eight cents from Thursday’s latest record close to US$4.45 a pound. Teck Resources (TSX:TCK.B) gained 83 cents to $61.79 while Quadra FNX Mining (TSX:QUX) was ahead 19 cents to $16.75.

Gold stocks also advanced as bullion made headway with the February contract on the Nymex ahead $15.50 to US$1,421.40 an ounce. Goldcorp Inc. (TSX:G) gained 54 cents to $45.88 while Barrick Gold Corp. (TSX:ABX) ran up 51 cents to $53.12.

The TSX energy sector was slightly lower even as oil prices moved ahead after losing ground in the wake of data Thursday which showed a much smaller than expected decline in U.S. crude inventories in the latest week. The February crude contract in New York was up $1.54 to US$91.38 a barrel. Cenovus Energy (TSX:CVE) was ahead 33 cents to $33.28 while Talisman Energy (TSx:TLM) shed 13 cents to $22.12.

The telecom sector was up about 12% for the year, but was the leading laggard on the TSX Friday with Telus Corp. (TSX:T) down 46 cents to $45.48.

Many of the world’s leading stock markets ended the year up higher as the global economy has recovered over the past 12 months from its worst recession since the Second World War.

However, concerns about inflation in the wake of higher commodity and energy costs, Chinese monetary policy moves to control price rises and cool a booming property market and Europe’s continuing debt crisis have meant that 2010 has not been all clear sailing.

A number of markets are ending the year down, including China’s Shanghai index which closed up 1.8% Friday to end the year about 14% lower.

Investors in China have become increasingly worried in the last few months that the monetary authorities will have to take more aggressive action to cool the overheating economy and keep a lid on surging inflation. Last weekend’s surprise interest rate hike, the second since October, provided further evidence that 2011 will not be as easy as recent years.

Hong Kong’s Hang Seng index rose 0.2%, to end the year 7% higher.

South Korea’s Kospi ended the year on Thursday about 22% higher then at the start of 2010.

Japan’s benchmark Nikkei 225 stock average ended the year 3% lower, as investors worry about the impact on exporters of the rising yen.

In Europe, the FTSE 100 index of leading British shares closed down 1.2%, ending the year around 10% higher. The CAC-40 in France fell 1.2%, meaning it has ended the year about 3% lower.

Germany’s DAX was closed Friday, having ended the year Thursday around 16% higher.

In corporate news, global steel giant ArcelorMittal has increased its bid for Baffinland Iron Mines Corp. (TSX:BIM) to $1.40 per share cash, matching the price offered by rival Nunavut Iron Ore Acquisition Inc. ArcelorMittal is offering to buy 100% of Baffinland, whereas Nunavut Iron is proposing to acquire just 60% of the company. Baffinland shares ran ahead five cents to $1.43.

Imax Corp. (TSX:IMX) shares rose $1.16 to $28.04 after earlier going as high as $32.56 after Britain’s Daily Mail newspaper reported that Sony Corp. was eyeing the theatre system company for a takeover. However, the company issued a statement Friday afternoon saying it was not aware of any corporate developments that would account for the stock movement.

Shares of Ottawa-based Wi-LAN Inc. (TSX:WIN) gained 40 cents to close at $6.40 after the company said a U.S. district court’s ruling bodes well for the technology company’s defence of one of its patents.

SeAH Holdings Corp. of Seoul, South Korea, has substantially increased its holdings of Avanti Mining Inc. (TSXV:AVT) through a private placement and now owns nearly 13% of the Vancouver-based company’s common shares. Avanti shares edged up two cents to 35.5 cents.

Parkland Income Fund (TSX:PKI.UN), Canada’s largest independent fuel distributor has acquired Island Petroleum Products Ltd. of Prince Edward Island in a cash and equity deal valued at $22.6 million. Its units were up nine cents at $11.49.