CANADA STOCKS-TSX extends rally on financial, energy gains
* TSX up 26.70 pts, or 0.2 pct, at 11,597.89 * Energy shares rise on higher U.S. oil * Financials gain on solid BofA earnings * Dampened Fed stimulus hopes weigh on gold miners By Jon Cook TORONTO, July 18 (Reuters) - Canadian stocks were headed for their fourth straight session of gains on Wednesday as financial and energy shares rose on higher oil prices and solid U.S. earnings, but worries about the euro zone economy limited gains. Canadian financials led the broader index higher, rising 0.4 percent. The influential sector continued to garner support from better-than-expected earnings from U.S. banks. On Wednesday, Bank of America Corp, the second-largest U.S. bank, posted second-quarter earnings of $2.5 billion, reversing a year-earlier loss. "At the end of the day the numbers have been better than expectations and that has improved the sentiment toward the financials," said Bob Gorman, chief portfolio strategist at TD Waterhouse. JPMorgan Chase & Co, Wells Fargo & Co, Citigroup Inc and Goldman Sachs Group Inc in recent days all beat analysts' earnings estimates. Also on Wednesday, U.S. bellwethers Intel and Honeywell reported profits, defying the downward trend of U.S. economic growth. In Canada, financial gains were led by Toronto-Dominion Bank , up 0.7 percent to C$80.48, Bank of Nova Scotia , which edged up 0.8 percent to C$52.46, and Bank of Montreal, rose 0.6 percent to C$57.92. The oil and gas patch also rose 0.3 percent as U.S. crude was heading for its highest close since May 29, after bloodshed in Syria highlighted worries about supply from the Middle East. The most influential gainers included: Canadian Natural Resources, up 2.5 percent at C$28, Suncor Energy , which rose 0.8 percent to C$30.23, and TransCanada Corp , up 0.6 percent at C$44.05. At 1:15 p.m. EDT (1715 GMT), the Toronto Stock Exchange's S&P/TSX composite index was up 26.70 points, or 0.2 percent, at 11,597.89. At one point the index touched 11,615.38, its highest level since July 10. Gains were limited by losses from the heavily-weighted materials sector, which slid 0.1 percent as gold fell on dampened speculation that the cooling U.S. economy would imminently require more stimulus. Declines were led by top gold miners Goldcorp Inc, which fell 3.2 percent to C$33.01, Barrick Gold, off 0.7 percent at C$34.82, and Yamana Gold, down 2.5 percent to C$14.59. Also weighing was Cogeco Cable Inc, whose shares plunged more than 15 percent to C$37.72 after the company said on Wednesday it will pay $1.36 billion to buy U.S. cable operator Atlantic Broadband. Worries about Europe's debt crisis were also reignited following comments by German Chancellor Angela Merkel. The German leader was quoted in a media report as saying, "We have not yet shaped the European project so that we can be sure that everything will turn out well, we still have work to do." Markets were already in a nervous mood after U.S. Federal Reserve Chairman Ben Bernanke said on Tuesday that the U.S. economic recovery was being held back by anxiety over Europe's debt crisis. However on Wednesday, before a House Financial Services Committee, Bernanke moderated his tone, saying the world's top economy would experience "continued moderate growth." Bernanke's remarks were backed up by fresh data that showed U.S. housing starts rose 6.9 percent last month to a seasonally adjusted annual rate of 760,000 units, the highest rate since October 2008. "You're not seeing further deterioration," said Gorman. "The worst fears are not being realized."
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