TSX notches highest close in 10 weeks on euro relief

Wed Jan 18, 2012 4:51pm EST
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By Claire Sibonney

TORONTO (Reuters) - Canadian stocks notched their highest close in more than 10 weeks on Wednesday, tracking a broad rally in riskier assets on hopes that the International Monetary Fund would be able to raise more money to help resolve Europe's debt crisis.

The IMF is seeking to boost its war chest by $600 billion to help countries reeling from the crisis, but some nations insist Europe must first do more to support ailing members, sources said.

Meanwhile, Greece and its creditors resumed negotiations on terms of a planned debt swap, hoping to overcome an impasse in talks and stave off a painful default.

Suncor Energy (SU.TO: Quote) led the gains, rising 2.2 percent to C$33.94, followed by Canadian Natural Resources (CNQ.TO: Quote), up 2.7 percent to C$38.76 and Royal Bank of Canada (RY.TO: Quote), which added 1.2 percent to C$52.45.

"There must be some sense that maybe it's just the daily relief of the skirmishes in Europe. The market seems to be very reactively as to whether or not things are going positively there, particularly with respect to the financials," said Michael Sprung, president of Sprung & Co Investment Counsel.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended up 94.69 points, or 0.77 percent, at 12,327.52. It was the TSX's strongest close since November 8.

Bank of Nova Scotia (BNS.TO: Quote) was another big gainer, up 1.5 percent to 52.56, after announcing it will acquire 51 percent of Colombia's Banco Colpatria COL.CN through a combination of $500 million in cash and 10 million common shares.

Despite far less exposure to risky European debt assets than their global counterparts, an easing of the euro zone's debt crisis would still reflect positively on Canadian banks.   Continued...

<p>A general view of the TSX (Toronto Stock Exchange) Broadcast Centre in Toronto June 20, 2008. REUTERS/Mark Blinch</p>