TSX surges on gold miners, Greek hopes

Thu Feb 16, 2012 5:46pm EST
 
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By Jon Cook

TORONTO (Reuters) - Canadian stocks notched their biggest single-day gain this month on Thursday as gold-mining earnings, higher oil prices and strong U.S. economic data boosted resource shares, while euro-zone debt fears eased.

Fourth-quarter earnings from Canada's top gold producers initially failed to excite, but on closer inspection sharp dividend increases by Kinross Gold (K.TO: Quote) and Agnico-Eagle (AEM.TO: Quote) won over investors. Kinross and Agnico shares both jumped 7 percent to C$11.07 and C$36.57 respectively.

"You look at the valuations and they appear to be cheap," said Joe Tatusko, chief investment officer at brokerage firm Westport Resources in Connecticut. "Any sliver of good news is going to have these guys move."

Shares of the country's two biggest gold miners, Barrick Gold (ABX.TO: Quote) and Goldcorp (G.TO: Quote) also rose but by a smaller margin as both reported solid quarterly results and continued success in their exploration programs. Goldcorp jumped 4.5 percent to C$47.25, while Barrick was up 1 percent to C$48.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE finished up 123.56 points, or 1 percent, at 12,485.59, its highest close in a week and its biggest one-day rise since January 25.

Oil and gas issues also drove gains, rising more than 1 percent after Brent crude prices hit an eight-month high above $120 a barrel on Iran supply concerns and an expected drop in North Sea output. <O/R>

Energy gains were led by Canadian Natural resources CNQ.TO, which rose 1.8 percent to C$37.07. Encana Corp (ECA.TO: Quote) jumped 4.4 percent to C$20.15 ahead of reporting fourth-quarter results on Friday.

Cenovus Energy (CVE.TO: Quote) was up 1.4 percent at C$38.61 after Canada's No. 2 independent oil producer said on Wednesday its quarterly profit tripled on production gains.   Continued...

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