TSX halts slide as miners rally on stimulus hopes
By Jon Cook
TORONTO (Reuters) - Canada's main stock index halted its three-day skid on Wednesday, rising with mining shares as investors were hopeful that deteriorating global economic conditions would spur stimulus moves by central banks in the United States and Europe.
Weak data from the United States and Europe raised expectations the Federal Reserve and European Central Bank would announce more monetary easing measures when they hold meetings next week.
ECB Governing Council member Ewald Nowotny said there were arguments for giving Europe's new permanent rescue fund a banking license, enabling it to borrow unlimited central bank money and so boosting its capacity to prevent the crisis from spreading.
"We've seen this phase for the past couple summers, where the economic data starts coming in a little bit weaker and the market turns to central banks for more gas in the engine," said Craig Fehr, Canadian market strategist at Edward Jones in St. Louis, Missouri.
The news was welcomed by Canada's beaten-down materials sector, which climbed 1.5 percent as gold mining stocks rallied with bullion prices. <GOL/>
Top gold producers led the way, with Goldcorp (G.TO: Quote) jumping 3.5 percent to C$34.84 and Barrick Gold ABX.TO up 2.2 percent at C$34.49.
Energy shares also turned higher, edging up 0.1 percent as oil prices rebounded on increased Middle East turmoil and hopes for further Fed stimulus. <O/R>
Suncor Energy (SU.TO: Quote) -- Canada's largest oil producer -- led gains, rising 3.7 percent to C$30.87 a day after reporting a 28 percent jump in second-quarter profit. The company also said on Wednesday it will no longer commit to an ambitious growth program that had troubled some shareholders. Continued...