Energy surge on OPEC deal boosts TSX; index up 2 percent in month

Wed Nov 30, 2016 4:46pm EST
 
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By Alastair Sharp

TORONTO (Reuters) - A surge in shares of Canadian energy companies pushed the country's main stock index to a near 18-month intraday high on Wednesday as major crude producers reached a deal to curb production.

The energy group, which accounts for one-fifth of the Toronto Stock Exchange's S&P/TSX composite index, jumped 7.9 percent as crude prices soared. [O/R]

The index ended up 83.04 points, or 0.55 percent, at 15,082.85, for a 2 percent gain in November. It hit 15,141.02 in morning trade, its highest level since June 3, 2015.

Twenty-six stocks posted new 52-week highs.

OPEC members and Russia agreed to limit their oil output in a bid to prop up prices, after Saudi Arabia accepted "a big hit" on production and dropped its demand that arch-rival Iran slash output.

"They've found a way to get it done," said Bryden Teich, portfolio manager at Avenue Investment Management.

If a deal had not been reached oil could easily have slumped below $40 per barrel, he said. Crude instead jumped more than 10 percent to over $50 a barrel. [O/R]

Energy shares accounted for 22 of the 30 most influential gainers in Canada, with several names jumping as much as 17 percent. Suncor Energy Inc rose 6.8 percent to C$42.78 and Canadian Natural Resources Ltd added 8.8 percent to C$45.33. Encana Corp jumped 10.9 percent to C$16.87 and Cenovus Energy Inc advanced 9.6 percent to C$20.77.   Continued...

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