TSX rises as resource stocks rally, Rona nearly doubles

Wed Feb 3, 2016 5:15pm EST
 
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By Fergal Smith

TORONTO (Reuters) - Canada's main stock index rose on Wednesday as strength in commodity prices supported energy and mining stocks, while shares in home retailer Rona Inc RON.TO almost doubled after a generous takeover deal.

The index snapped a two-day losing streak, rebounding from a one-week low earlier in the session as a weaker U.S. dollar helped drive commodity markets higher.

"This is all U.S. dollar related," said Norman Levine, managing director, Portfolio Management Corp.

Since resource markets are priced in U.S. dollars, a lower U.S. dollar has a very positive effect on resource prices, he added.

The dollar hit its lowest level against the euro since last October on growing expectations for a slower pace of Federal Reserve rate hikes this year.

Oil prices jumped 8 percent [O/R], while gold rose to three-month highs.

The energy group rallied 4.5 percent. It included a 3.8 percent gain for pipeline company Enbridge Inc (ENB.TO: Quote) to C$47.87, while Canadian Natural Resources Ltd (CNQ.TO: Quote) was up 7.9 percent at C$29.94.

Gold miners were also among the most influential risers. Barrick Gold Corp (ABX.TO: Quote) added 6.7 percent to C$14.77, while Goldcorp Inc (G.TO: Quote) was up 8.2 percent at C$17.12.   Continued...

 
A man walks past an old Toronto Stock Exchange (TSX) sign in Toronto, June 23, 2014. REUTERS/Mark Blinch