CANADA STOCKS-Manulife deal helps TSX rise, but oil shares drop

Wed Apr 8, 2015 4:49pm EDT
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(Adds fund manager comment, updates prices to close)

* TSX up 24.76 points, or 0.16 percent, at 15,213.60

* Eight of ten main sectors rise; resource groups weigh

By Alastair Sharp

TORONTO, April 8 (Reuters) - Canada's main stock index barely managed to extend its rally to five sessions on Wednesday as energy stocks tumbled in line with a pullback in oil prices, although much of the index outside resources recorded gains.

Manulife Financial Corp led major financial stocks higher after signing an Asian distribution deal, while a range of telecom, consumer, healthcare and industrial names made more modest gains.

But energy stocks, which account for more than 21 percent of the index's weight, failed to get a boost from news that Royal Dutch Shell would buy BG Group for some $70 billion, in part because investors never let go of takeover premiums priced in after the Repsol-Talisman deal, according to one fund manager.

"Canadian energy stock prices are not reflecting reality here, they're reflecting a lot of hope," said Norman Levine, managing director at Portfolio Management Corp.

It didn't help that oil prices dived 6 percent on a mammoth rise in U.S. crude stockpiles and record Saudi production.   Continued...