TSX rises as energy, mining shares jump

Mon May 12, 2014 6:08pm EDT
 
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By John Tilak

TORONTO (Reuters) - Canada's main stock index rose on Monday, reversing some of the previous week's losses, as shares of natural resource companies were buoyed by advances in the prices of commodities such as gold, copper and oil.

Commodity prices benefited from worries about the situation in eastern Ukraine, where pro-Moscow rebel leaders called for their region to become part of Russia, the day after staging a referendum on self-rule. Moscow, however, stopped short of endorsing their bid for annexation.

The Toronto market's advance came on the heels of a 1.6 percent drop in the previous week caused by concerns over Ukraine and a selloff in energy stocks.

The energy sector jumped 1.3 percent on Monday and had the biggest positive influence on the market. The group, one of the strongest performers this year, is up more than 14 percent so far in 2014.

"We're seeing a new interest in oil and gas," said Michael Simpson, senior portfolio manager at Sentry Investments.

Higher oil prices and the prospects of a possible rise in natural gas prices were supporting energy shares, he added.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE closed up 120.88 points, or 0.83 percent, at 14,654.94. It has added about 7.6 percent this year.

While stocks are not as cheap as they were a while ago, investors recognize that equities are "a much better alternative to investing in bonds," Simpson said. But he added that "some investors want to limit their exposure to Canada because they are seeing a stronger U.S. economy."   Continued...

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