* TSX gains 0.79 percent to 11,838.79
* Commodities price gains drive rally
* Manufacturing activity in major economies rises
By Ka Yan Ng
TORONTO, Jan 4 (Reuters) - Toronto’s main stock market closed more than 1 percent higher on Monday, backed by soaring oil and gold prices and global manufacturing data that suggested more improvement in the world economy.
Eight of the top 10 heavyweight advancers were resource-based stocks, including oil companies Suncor Energy (SU.TO) and EnCana Corp (ECA.TO), as oil prices soared above $81 a barrel, and the price of gold and other precious metals also rallied.
Overall, the index’s energy group rose 2.29 percent, while its mining-heavy materials sector climbed 2.55 percent. [O/R] [GOL/]
Suncor was the biggest heavyweight riser, up 2.9 percent to C$38.30, while EnCana shot up 4.7 percent to C$35.71. Diversified miner Teck Resources TCKb.TO rallied 5.95 percent to C$39.01, while Barrick Gold (ABX.TO) rose 1.5 percent to C$42.08.
Manufacturing data from major economies reinforced evidence that a global recovery was in motion. Chinese manufacturing grew at its fastest pace on record in December, while U.S. factories marked their best month in nearly four years. Other data showed strength in British and euro zone factory production growth. [ID:nSGE60301H]
“Clearly the stronger manufacturing reports out of China, Europe, and the U.S. are giving investors a bit more confidence that we’ll see continued strong economic growth,” said Kate Warne, Canadian market strategist at Edward Jones in St. Louis, Missouri.
“That’s the reason we’re seeing the TSX led higher by energy and materials. The commodities are the most sensitive to expectations about higher growth.”
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed up 120.79 points, or 1.03 percent, at 11,866.90. Seven of the index’s 10 main groups were higher.
$1=$1.04 Canadian Editing by Peter Galloway