4 Min Read
*Mining stocks climb; Rio Tinto to cut 14,000 jobs
*Nortel falls, to explore bankruptcy scenario -report
*Financials sag as Great-West Lifeco issues equity (Adds quote, details)
TORONTO, Dec 10 (Reuters) - Toronto's main stock index rallied at the open on Wednesday on higher oil and metals prices and as optimism over global stimulus measures, including a possible bailout of the U.S. auto industry, helped market sentiment.
Mining stocks rose even though global miner Rio Tinto (RIO.AX) said it would cut 14,000 jobs, slash capital spending by more than half and sell more assets as it battles a collapse in commodity prices. [ID:nSP365347]
Oil and gas stocks rose 2.4 percent as oil climbed above $44 a barrel, after slumping overnight on demand worries ahead of U.S. weekly inventory data. [ID:nSIN422139]
"It's them coming off those deep oversold levels," Peter Chandler, senior vice-president at Canaccord Capital in Waterloo, Ontario, said of the resource sectors.
"It's also a belief that we are, with an increasing likelihood, going to see coordinated infrastructure spending programs announced early in the new year in multiple geographies that will auger well for the demand for a lot of materials."
Toronto stocks followed equity markets around the world higher on firmer commodity prices and optimism over a possible bailout of the U.S. auto industry, as well as other global stimulus measures to fight a deepening economic crisis. [MKTS/GLOB]
At 10:00 a.m. (1500 GMT), The S&P/TSX composite index .GSPTSE was up 120.46 points, or 1.43 percent, at 8,518.02, with six of its 10 main groups higher.
Financials were down 0.6 percent with Great-West Lifeco Inc (GWO.TO) sinking 8 percent to C$20.53 after it said on Tuesday it plans to issue a total of C$1 billion in common shares to the public and to its controlling shareholder, Power Financial Corp (PWF.TO). [ID:nN09284029]
Shares of George Weston Ltd (WN.TO) rose 1.4 percent to C$61.75 after Mexico's Bimbo (BIMBOA.MX) said on Wednesday it had reached an agreement to buy the U.S. breadmaking unit of George Weston for $2.38 billion.
Nortel Networks Corp NT.TO sank 20.3 percent to 51 Canadian cents after the Wall Street Journal reported the company has sought legal advice on a bankruptcy protection scenario in the event that its restructuring plan fails. [ID:nBNG408213] ($1=$1.26 Canadian) (Reporting by Jennifer Kwan; editing by Peter Galloway)