TSX climbs on BOJ stimulus steps; gold miners drop
By John Tilak and Susan Taylor
TORONTO (Reuters) - Canada's main stock index advanced on Friday after fresh stimulus measures from the Bank of Japan drove up most major sectors, while shares of gold miners slumped with the price of bullion.
The Japanese central bank expanded its massive stimulus spending in an admission that economic growth and inflation have not picked up as much as expected after a sales tax hike in April.
The move fueled a surge in the U.S. dollar .DXY, sending the bullion price XAU= tumbling. Shares of gold miners dived yet again, slumping to their lowest in about 13 years.
The benchmark TSX went through a rough patch in recent weeks, hit by volatile commodity prices and worries about global growth. But with Friday’s gains, the index has rebounded about 7 percent from an eight-month low it hit two weeks ago.
“It’s Halloween today, but investors don’t seem to be finding the markets scary anymore. And much of this has been driven by stimulus,” said Elvis Picardo, strategist and vice president of research at Global Securities in Vancouver.
“It’s reassuring to see that we have climbed back a thousand points from a selloff that was bordering on panic,” he said, referring to the Canadian equity market's recent choppiness.
“But you’ve had a big shakedown of the commodity complex,” he added. “Against that backdrop, it’s difficult to see the TSX make a sustained move upwards.”
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE closed up 154.63 points, or 1.07 percent, at 14,613.32. Eight of the 10 main sectors on the index were higher. Continued...