December 1, 2010 / 3:51 PM / 7 years ago

CANADA STOCKS-TSX hits 3-week high on soaring oil, banks

4 Min Read

* TSX jumps 1.01 percent to 13,083.80

* Index hits highest level since Nov. 9

* Bank shares surge after National Bank ups dividend

* Energy shares fueled by China data, oil price rise (Adds details)

By Ka Yan Ng

TORONTO, Dec 1 (Reuters) - Toronto's main stock index advanced strongly on Wednesday morning as energy issues got a lift from firm manufacturing data from China, while financials were supported by a strong start to bank earnings season.

Top advancers were in the index's banking and energy groups. Royal Bank of Canada (RY.TO) rose 1.8 percent to C$55.97, while Toronto-Dominion Bank (TD.TO) gained 1.4 percent to C$75.73. Canadian Natural Resources (CNQ.TO) advanced 1.9 percent to C$40.25, while Suncor Energy (SU.TO) was up 1.8 percent at C$35.

Stock markets around the world were driven higher on Wednesday by better-than-expected Chinese factory data in November that showed the Chinese purchasing managers' index rose to a seven-month high. [ID:nTOE6B004C] [MKTS/GLOB]

Toronto's oil and gas sector responded to the Chinese data with a 1.36 percent jump, reinforced by a near 2 percent rally in the price of crude oil.

Financials were up 1.5 percent the day after National Bank of Canada (NA.TO) reported a 19 percent jump in quarterly profit and became the first major domestic bank to resume dividend hikes in the wake of the financial crisis, It raised its dividend a hefty 6.5 percent, spurring hopes that other banks will follow suit. [ID:nN30174732]

National Bank was up 2.34 percent at C$69.43.

"We're all expecting who is going to be next, and how much are they going to raise by," said Barry Schwartz, portfolio manager at Baskin Financial Services. "We're really off to the races with these guys. Profits should be growing and Canadian banks are fat and happy with extra capital.

"Unless we face a dip back into recession we should be in for a really nice run on an increase in earnings for the whole bank complex."

At 10:25 a.m. (1525 GMT), the Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was up 130.92 points, or 1.01 percent, at 13,083.80. All 10 of its sectors were higher. Shortly after the open, the index had jumped to its highest level since Nov. 9.

The Chinese data also drew focus away from euro zone debt worries, although there was mounting market speculation that the European Central Bank may step in with more sovereign debt purchases to help ease concerns.

Shares of Patheon PTI.TO, the Canadian pharmaceutical company that was nearly taken over by Switzerland's Lonza Group a year ago, rose 6.4 percent to C$2.16 after it said its chief executive, Wesley Wheeler, had left the company. [ID:nSGE6B00N8]

Rogers Communications (RCIb.TO) was up 0.6 percent at C$36.50 after a media report said the company is in talks to buy a majority stake in sports conglomerate Maple Leaf Sports and Entertainment, which owns the NHL's Maple Leafs and NBA's Raptors. [ID:nN01118229]

$1=$1.02 Canadian Reporting by Ka Yan Ng; editing by Peter Galloway

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