TSX climbs to a six-week high, led by financials and energy as oil surges

Wed Feb 17, 2016 5:00pm EST
 
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By Fergal Smith

TORONTO (Reuters) - Canada's main stock index scored a six-week high on Wednesday, led by financial and energy stocks after crude oil prices surged on supply freeze optimism.

Reduced concern among some investors about macro issues has helped lift the index more than 7 percent from below 12,000 less than a week ago.

It has "triggered a relief rally" in an "oversold" market, according to Ben Jang, a portfolio manager at Nicola Wealth Management.

China's economic slowdown, depressed crude oil prices and European financial sector stress have weighed on global stocks since the start of the year, according to Macan Nia, director, capital markets & strategy at Manulife Asset Management.

"China opened this week (after the Lunar New Year holiday)and there wasn't any precipitous selling, so that gave reassurance to global investors," said Nia.

"Valuations were much more attractive than what they were at the beginning of the year and you have seen long-term investors strategically buy companies that they think have been thrown out with the bathwater," he added.

Energy stocks rose 5.8 percent, tracking strength in crude oil prices after Iran voiced support for a Russia-Saudi-led move to freeze production.

Suncor Energy Inc (SU.TO: Quote) rose 6.1 percent to C$32.89, while Canadian Natural Resources (CNQ.TO: Quote) was up 7 percent at C$29.80.   Continued...

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