TSX nears record as oil rallies, U.S. tax cut hopes revive

Thu Feb 9, 2017 4:47pm EST
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By Fergal Smith

TORONTO (Reuters) - Canada's main stock index rose on Thursday to its highest close in two weeks, nearing an all-time peak, as higher oil prices and the prospect of U.S. tax cuts helped trigger gains for heavyweight energy and financial shares.

U.S. President Donald Trump said he would be releasing a "phenomenal" tax plan in the next few weeks, reviving bets for pro-growth policies from the new administration.

"If he cuts corporate taxes ... it would obviously be very positive for a lot of companies south of the border and hopefully fuel growth," said Manash Goswami, portfolio manager at First Asset Investment Management Inc.

"We continue to put capital to work, we continue to favor cyclical sectors over more defensive sectors."

Cyclical sectors, such as financials, industrials and technology tend to benefit most from a pickup in economic growth.

The Toronto Stock Exchange's S&P/TSX composite index ended up 63.26 points, or 0.41 percent, at 15,617.30, its highest close since Jan. 25 and back in reach of its September 2014 record peak of 15,685.13.

Recent better corporate earnings and economic data have pushed the market higher, Goswami said.

Suncor Energy Inc, Canada's largest oil and gas company, climbed 2.4 percent to C$41.47 after it reported a larger-than-expected fourth-quarter profit on Wednesday.   Continued...

A sign shows TSX information in Toronto September 15, 2008.    REUTERS/Mark Blinch