November 4, 2008 / 4:33 PM / in 9 years

CANADA STOCKS-Toronto hits two-week high in broad rally

* Index above 10,000 for first time in two weeks

* Energy issues gain as oil rises above $68

* Talisman Energy up 9.4 pct as profit quadruples

TORONTO, Nov 4 (Reuters) - The Toronto Stock Exchange’s main index .GSPTSE jumped nearly 4 percent to hit a two-week high on Tuesday morning as commodity-related issues advanced as oil prices firmed on supply cuts.

Nine of the index’s 10 main groups were higher, with the oil and gas sector and the materials group leading the way, climbing 5.65 percent and 8.4 percent respectively.

Oil accelerated above $68 after industry sources said Saudi Arabia had already made substantial cuts in supplies. [ID:nSP182808]

Talisman Energy TLM.TO rose 9.4 percent to C$12.76 as Canada’s No. 4 independent oil explorer reported that its quarterly profit had quadrupled, the latest in a string of strong earnings from oil and gas companies. [ID:nN03372777]

Shortly after 11:10 a.m. (1610 GMT), the S&P/TSX composite index .GSPTSE was up 364.53 points, or 3.8 percent, at 10,085.79, climbing above the 10,000 level for the first time since Oct. 21.

The index closed lower in the past two days but the losses were not as substantial as they were in October, when the index dove nearly 17 percent.

“I think there’s an opportunity to see a rally for the next little while, with less volatility,” said Paul Harris, portfolio manager at Avenue Investment Management.

The materials sector posted strong gains as gold edged above $750 an ounce, and other metals such as copper and silver participated in a broad commodity rise as the U.S. dollar eased.

The U.S. presidential election was also in focus, with polls showing Democrat Barack Obama holding a decisive edge over Republican John McCain. The end of the campaign will “clear up a lot of questions” in terms of the economy, said Harris.

No matter who ends up in the White House, the economy will be at the top of the agenda and the new president will face the challenge of leading the United States out of its worst financial crisis in 80 years.

The economic slowdown sideswiped auto-parts maker Magna International MGa.TO, which swung to a third quarter loss and cut its 2008 consolidated sales outlook. [ID:nBNG373290] Magna stock fell 7.2 percent to C$38.05.

$1=$1.15 Canadian Reporting by Ka Yan Ng; editing by Rob Wilson

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