TSX hits five-month high; banks, industrials lead gains
By Alastair Sharp
TORONTO (Reuters) - Canada's main stock index on Wednesday notched its highest close since November as financial and industrial shares rallied on surprisingly upbeat China trade data and unexpectedly strong earnings from U.S. bank JPMorgan.
"It's not the apocalypse, it's not doom and gloom," said Barry Schwartz, a portfolio manager at Baskin Financial Services. "And if it's not doom and gloom you can come out of the bunker and the first thing you do is take a sigh of relief and then you want to make money."
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended up 89.93 points, or 0.66 percent, at 13,671.35. It last closed above that level on Nov. 3.
The most influential movers in the index included Royal Bank of Canada (RY.TO: Quote), which rose 1.4 percent to C$76.77, and Bank of Nova Scotia (BNS.TO: Quote), which advanced 1.8 percent to C$63.65.
Schwartz said Canadian bank stocks could rise further, given that the sector's valuation has fallen sharply even though earnings rose about 6 percent last year.
Financial shares gained 1.2 percent, while industrials rose 2.4 percent and consumer discretionary stocks were up 1 percent.
"If oil continues to rally and the Canadian economy continues to benefit from improving U.S. data and Asian data, from China and overseas, then of course the TSX is dramatically undervalued," Schwartz added.
Oil prices jumped to a more than four-month high on Tuesday on hopes major producers could reach a deal to curb output. Prices slipped on Wednesday after comments from Russia's energy minister reignited doubts that the producers would reach a deal in a meeting scheduled for Sunday in Doha. Continued...