3 Min Read
* U.S. bank stress tests boost investor optimism
* Canada unexpectedly adds 35,900 jobs in April
* Energy group leads with 3 percent gain (Adds details, background and analyst comment)
By Ka Yan Ng
TORONTO, May 8 (Reuters) - Toronto's main stock market index climbed on Friday after as-expected results of stress tests for U.S. banks boosted investor optimism about the global financial system and the economy, while rising commodity prices bolstered key components of the overall market.
Better than expected U.S. and Canadian jobs figures added another layer of positive investor sentiment.
The U.S. bank reviews showed 10 banks needed additional capital to withstand heavier losses that would likely come if the recession worsened. U.S. regulators told top banks after the close on Thursday to raise $74.6 billion to build a capital cushion. [ID:nN07333426]
"People have had time to digest the results of the stress tests from yesterday. I don't think that it was any surprise to anyone. It was probably the poorest kept secret in the world," said Michael Sprung, president at Sprung & Co. Investment Counsel.
"For today, the market is taking that at face value."
At 10:15 a.m. (1415 GMT), the S&P/TSX composite index .GSPTSE was up 72.79 points, or 0.73 percent, at 10,039.84. Earlier, it had risen more than 2 percent to hit a session high of 10,170.48.
Seven of the index's 10 main sectors were higher.
The energy group rose 3 percent, bolstered by a firm oil price nearing $58 a barrel. Financials gained more nearly 1 percent.
Job numbers also help lift wider market sentiment. Canada unexpectedly added 35,900 jobs in April, surprising analysts who had expected the economy to continue its recent pattern of posting heavy losses. The jobless rate remained stable at 8 percent. [ID:nN08444159]
U.S. employers cut 539,000 jobs in April, the smallest number since October and below analyst forecast. The unemployment rate jumped to 8.9 percent. [ID:nOAT002119] (Reporting by Ka Yan Ng; editing by Rob Wilson)