TSX touches record highs as Tim Hortons rallies

Mon Aug 25, 2014 5:02pm EDT
 
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By John Tilak

TORONTO (Reuters) - Canada's main stock index touched an all-time high before notching a record high close on Monday as shares of Tim Hortons Inc shot upward after the coffee chain confirmed it was in merger talks with Burger King.

Tim Hortons and Burger King said late on Sunday the new company would be the world's third-largest quick service restaurant and would be based in Canada.

Tim Hortons, which soared 19 percent, hit a multiyear high and was the most actively traded stock on the Toronto exchange.

Investors also continued to focus on monetary policy and speculate about the outlook for interest rates, while processing recent comments from the U.S. Federal Reserve and the European Central Bank.

The benchmark TSX is up more than 14 percent this year, making it one of the biggest gainers among its global peers.

Investors are expecting a correction, given the extent of those advances and signs the market could be getting more choppy, said Marcus Xu, president and portfolio manager at M.Y. Capital Management Corp in Vancouver.

"It's not fundamental, it has nothing to do with data. It’s psychology," he said. "The second half of the year is going to be volatile."

Xu is positive about the Canadian financial, energy and technology sectors.   Continued...

 
A sign board displaying Toronto Stock Exchange (TSX) stock information is seen in Toronto June 23, 2014. REUTERS/Mark Blinch