CANADA STOCKS-TSX regains some ground as commodity prices rise

Tue Sep 25, 2012 11:11am EDT
 
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* TSX up 42.87 points, or 0.35 percent, to 12,355.15
    * Gold miners and banks lead rise, energy lags

    By Alastair Sharp
    TORONTO, Sept 25 (Reuters) - Canada's benchmark equity index
rose broadly on Tuesday morning in a rally led by gold miners
and banks as commodity prices recovered from a drop the previous
day.
    Oil, gold and copper prices all moved higher, helping the
resource-rich Toronto index to jump a third of a percent.
    Miner Barrick Gold Corp rose 1.3 percent to C$40.94
and competitor Goldcorp gained 1.2 percent to C$44.61.
Among banks, Royal Bank of Canada moved 0.9 percent
higher to C$56.66, and Bank of Nova Scotia added 0.7
percent to C$54.57.
    At 10:40 a.m. (1440 GMT), the Toronto Stock Exchange's
S&P/TSX composite index was up 42.87 points, or 0.35
percent, at 12,355.15. On Monday it dropped 70 points. 
    Although they helped the market on Tuesday, the lack of a
solid rising trend in commodity prices could turn away some
investors from now on, a fund manager warned.
    "With the direction for commodity prices being less certain,
the index will be less certain. The general trend for both gold
and oil will be higher but will not lead the market," said
Brendan Caldwell, president and chief executive of Caldwell
Investment Management.
    "Unless the U.S. dollar completely collapses and gold and
oil go on an unholy tear, which is possible, I think they'll do
well but other sectors will outperform and we don't have very
much of it in our index," he added, warning that the TSX may
struggle to keep up with global peers with deeper exposure to
sectors such as technology and consumer discretionary companies.
     Energy stocks limited the index's gain on Tuesday, with the
sector off 0.2 percent. Husky Energy Inc bucked the
trend, however, moving 0.4 percent higher to C$26.71 after the
integrated oil producer and refiner declared it had reached an
impasse with the United Steelworkers union in a four-month
strike at the company's 155,000 barrel-per-day Lima, Ohio,
refinery. 
     Shares in Forbes & Manhattan Coal Corp jumped 7.7
percent to 70 Canadian cents after the coal miner said it plans
to acquire two South African mines from a unit of Rio Tinto in a
bid to boost its output and enlarge its footprint in Africa.