TSX gains 2 percent on week as resource stocks push higher

Fri Oct 25, 2013 4:53pm EDT
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By Alastair Sharp

TORONTO (Reuters) - Canada's main stock index gained 2 percent this week, with Friday's broad-based gains led by heavyweight energy and banking stocks as the index extended its two-year peak.

Investors are growing optimistic about the resource-rich index amid the increased likelihood of extended monetary stimulus in the United States and renewed Chinese growth.

"The investment theme for Canadian stocks is different now versus just a few weeks ago," said Marcus Xu, a portfolio manager at MY Capital Management in Vancouver.

After suffering from ties to poorly-performing emerging markets, the commodities sectors are now likely to benefit as investors seek to make use of excess liquidity, he said.

"When liquidity is really high, eventually it is going to drive a rally in commodities," Xu said. "I'm surprised it didn't happen earlier."

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended up 74.67 points, or 0.56 percent, at 13,399.42. It gained 2 percent for the week, adding to gains of 1.9 percent and 1 percent in the prior two weeks.

The index is at its highest level since July 2011.

Suncor Energy Inc (SU.TO: Quote) was the single biggest positive influence, gaining 1.6 percent to C$37.66. The integrated energy company reports third-quarter earnings next week.   Continued...

People walk past an electronic board displaying the midday TSX index in Toronto February 16, 2011. REUTERS/Mark Blinch