August 3, 2012 / 3:03 PM / in 5 years

TSX rallies as U.S. jobs data lifts commodities

A Toronto Stock Exchange (TSX) logo is seen in Toronto November 9, 2007.Mark Blinch

TORONTO (Reuters) - Canada's main stock index had its largest one-day gain in a month on Friday as financial and resource shares were boosted after the U.S. economy added more jobs than expected in July, easing concerns about the health of the world's largest economy.

The data showed U.S. employers hired 163,000 workers, the most in five months and above expectations calling for an increase of 100,000 jobs.

The strong U.S. number came at the same time as corporate earnings "continued the pattern of being pretty decent," said Bob Gorman chief portfolio strategist at TD Waterhouse.

"This is one of the few days in which you had both oars in the water," added Gorman.

The news boosted commodity markets as the U.S. dollar fell, making dollar-denominated commodities cheaper for holders of other currencies. The 19-commodity Thomson Reuters-Jefferies CRB index .CRB had its biggest gain in a month.

Most of Canada's 10 main sectors finished higher. Leading the way was the powerful energy complex, which rose 2.5 percent as U.S. oil prices jumped 5 percent. <O/R>

Suncor Energy (SU.TO), Canada's largest oil producer, rose 3.6 percent to C$31.63, while Canadian Natural Resources (CNQ.TO) jumped 4.4 percent to C$27.95 and Cenovus Energy (CVE.TO) was up 2.9 percent to C$31.39.

Financials were also stronger, rising 1.2 percent on the prospect Canada's largest trading partner was stabilizing and possibly shaking off its doldrums.

The biggest mover was Royal Bank of Canada (RY.TO), which climbed 1.4 percent to C$51.60, while Toronto-Dominion Bank (TD.TO) was up 1.3 percent at C$79 and life insurer Manulife Financial Corp (MFC.TO) spiked 4 percent to C$10.77.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE finished up 156.09 points, or 1.4 percent, at 11,662.59. It was the index's biggest single-day percentage gain since July 3 when it spiked 2.2 percent due to positive developments in the euro zone debt crisis.

The rise ended a four-day slide, but the TSX was still down 0.9 percent for the week.

Friday's move in equities was also helped as investors took a second look at Thursday's statement by European Central Bank President Mario Draghi and concluded that help was on the way.

"The ECB did exactly what they needed to do, which was to remind the market that they will prevent an event," said Michael A. Gayed, chief investment strategist at Pension Partners LLC. "What has held money back from taking risk is the fear of a 2008 repeat."

The heavily weighted materials group, which includes miners, was up 1.2 percent as copper rebounded after hitting a six-week low on Thursday when the ECB held interest rates and announced no new stimulus plans. <MET/L>

The most influential gainers included Ivanhoe Mines Ltd (IVN.TO), which jumped more than 7 percent to C$8.60 after China-owned miner Chalco (2600.HK) said it will extend its offer for a majority stake in Mongolia-focused coal miner SouthGobi Resources Ltd (SGQ.TO). Ivanhoe is South Gobi's majority shareholder.

Barrick Gold (ABX.TO) shares were up 1.2 percent to C$32.83 and Goldcorp (G.TO) climbed 1 percent to C$36.09.

In Canadian earnings news, shares of Telus Corp (T.TO) rose 1.2 percent to C$63.17 after it said wireless revenue in the second quarter climbed 7 percent from the year-before period as both the total number of subscribers and their average monthly bills rose.

Shares of Agrium Inc (AGU.TO) edged up 0.7 percent to C$95.30 on Friday, a day after North America's biggest retail supplier of farm products and services reported record high second quarter profit.

($1=$1 Canadian)

Editing by Diane Craft

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