WRAPUP 2-Canada currency pares losses, stocks climb after Trump win

Wed Nov 9, 2016 1:30pm EST
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(Adds analyst comment, updates market reaction, adds details on forestry and autos sector)

By Alastair Sharp

TORONTO Nov 9 (Reuters) - Canada's currency pared some of its overnight losses while shares of energy producers and gold miners pushed its stock market up 1 percent as investors saw a Donald Trump presidency favoring the oil sector and potentially stoking inflation.

Some financial players also talked about increased prospects of a Bank of Canada rate cut to underpin growth which might be threatened by Trump's stance on trade, though the implied probability of near-term move held around 27 percent.

Energy stocks jumped 2.1 percent as bets that Trump might revive the Keystone XL pipeline boosted TransCanada Corp and the broader oil sands industry.

"Based on what he has said, I think this could be an overall benefit to the Canadian economy and Canadian stock market, to start with Keystone and then we can go from there," said Philip Petursson, chief investment strategist at Manulife Investments.

The materials sector, which includes gold miners, jumped 3 percent. Gold, which jumped nearly 5 percent at one point, was up about 1 percent.

The gold sector benefits from his win "because all of his policies are inflationary," said Diana Avigdor, head of trading at Barometer Capital Management.

At 12:01PM EDT (1701 GMT), the Toronto Stock Exchange's S&P/TSX composite index rose 134.18 points, or 0.92 percent, to 14,791.02.   Continued...