CANADA STOCKS-TSX boosted by bank profits, gold prices

Tue Mar 2, 2010 10:43am EST
 
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* TSX up 51.85 points at 11,779.91

* Financials, materials lead gainers

By Claire Sibonney

TORONTO, March 2 (Reuters) - Toronto's main stock index rose on Tuesday morning as gold prices surged and strong quarterly results from Bank of Montreal (BMO.TO: Quote) put the spotlight on the index's heavily weighted financial sector.

The strong performance at Canada's fourth-largest bank sent its shares up 3.2 percent to C$58.45 and extended a trend set last week by Canadian Imperial Bank of Commerce (CM.TO: Quote) and National Bank of Canada (NA.TO: Quote), suggesting the worst of credit woes are behind the nation's big lenders. [ID:nN02136197]

Royal Bank of Canada (RY.TO: Quote), the country's biggest bank, gained 1.3 percent to C$58.12.

"As the economy starts to firm you're going to have fewer loan losses and people become a little more optimistic," said Irwin Michael, a portfolio manager at ABC Funds, referring to Monday's data on robust fourth-quarter economic growth. [ID:nN01242801]

"I don't think we're going to see any dividend increases yet but the key thing is to see banks consolidate, either stabilize or improve on their earnings, and I think that will be a big factor for the marketplace."

Firm gold and oil prices also helped support the resource-heavy index.   Continued...