4 Min Read
* Energy sector roars 6.3 percent higher
* Fourth session of triple-digit gains
* Nine of 10 subsectors in positive territory (Adds comments, details; changes dateline from Toronto)
By Susan Taylor
OTTAWA, Jan 2 (Reuters) - Toronto's main stock index pushed 2.7 percent higher on Friday, as an energy sector rally helped power a fourth straight session of triple-digit gains to usher in the new year.
All but one of the Toronto Stock Exchange's 10 main sectors ended higher, led by the energy group, which surged 6.3 percent.
Big gainers included Suncor Energy (SU.TO), up 8.9 percent at C$25.83, Petro-Canada PCA.TO ahead 8.9 percent at C$29.11, and Canadian Natural Resources CNQ.TO gaining 6.7 percent to C$51.99.
"It's a combination of a pretty strong gain in oil prices coupled with the fact that valuations in some of these stocks are really attractive, given the decline they've had over the past year," said Elvis Picardo, analyst and strategist at Global Securities.
The S&P/TSX composite index .GSPTSE rose 246.41 points to close at 9,234.11 points.
Crude oil jumped $1.74, or 4 percent, to $46.34 a barrel, lifted by fears over European fuel availability amid rising Middle East tensions and a spat between Russia and Ukraine over natural gas supplies. [ID:nSP351690]
Oil has climbed 36 percent from a recent multi-year low of $33.87 on Dec. 19. But it is still down about $100 a barrel from its record high set in July.
The industrials group rose 3 percent, with Toromont Industries (TIH.TO) climbing 4 percent, to C$23.94, Canadian Pacific Railway (CP.TO) rising 2.6 percent to C$42.06, and Canadian National Railways (CNR.TO) jumping 3.3 percent to C$46.25.
"A lot of people have a lot of cash that they're sitting on. And this being a new year, maybe they were just looking for a place to put their money," said Adrian Mastracci, portfolio manager and president at KCM Wealth Management Inc.
Consumer staples was the sole sector ending lower, down 0.68 percent.
"It's a great way to start the year, but we've been telling our clients that these gains have to be taken with caution because you've had below-average volumes for the past week or so," Picardo said.
"The key thing to watch and see is if these gains can be sustained next week when trading volumes come back closer to normal."
The TSX composite index is up 11 percent since Dec. 24, but Mastracci does not expect the good times to continue for long.
"I would hold off on popping the champagne just yet," he said. "I'm expecting more bad news to come out ... I think that these upticks that we're getting now, however many we get, those are good times to sell into, in my view. Tweak that portfolio."
Canadian stocks fell 35 percent in 2008, the worst drop since 1931.
The blue chip S&P/TSX 60 index .TSE60 closed 15.01 points higher, or 2.8 percent, at 556.83.
On Wall Street, markets shrugged off a report by the Institute of Supply Management that said U.S. factory activity fell to a 28-year low in December. [ID:nN02360428]
Instead, investors bought shares in hopes that a recovery is on the horizon after a dismal 2008. The Dow Jones industrial average .DJI rose 258.30 points, or 2.9 percent, to 9,034.69, while the Nasdaq composite index .IXIC ended up 55.18 points, or 3.5 percent, at 1,632.21. ($1=$1.21 Canadian) (Additional reporting by Jeffrey Jones and Ka Yan Ng; editing by Rob Wilson)