CANADA STOCKS-TSX breaks 4-day slide as materials rebound

Fri Mar 11, 2011 4:44pm EST
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   * TSX ends up 35.67 points at 13,674.25
 * Materials, forestry issues up, energy flat
 * Oil lower; gold and copper recoup losses after Japan
 (Updates to close, adds details, commentary)
 By Claire Sibonney
 TORONTO, March 11 (Reuters) - Toronto's main stock index
pushed slightly higher on Friday as investors bought
beaten-down stocks and the market took comfort in lower oil
prices and predicted increased demand for basic materials as a
result of the huge earthquake in Japan.
 After four straight days of losses, the index bounced back
as oil prices fell, while gold and base-metal prices recouped
losses and bargain-hunters jumped into hard-hit commodity
 The energy sector was off but gold and base metal miners
dramatically reversed earlier declines, sending the index's
heavyweight materials group up 1 percent.
 Oil retreated after the devastating 8.9 magnitude
earthquake that shook Japan shut refineries and other
industrial facilities in the world's third-largest oil
consumer, which eventually brought some relief to investors.
 "Investors put into perspective what happened in Japan
wasn't going to have too much of an impact on the global
economy but it was going to probably have a beneficial impact
near term on oil demand," said Luciano Orengo, portfolio
manager at Manulife Asset Management.
 "The market has been inversely correlated lately to oil
prices. When oil prices go up, markets have been trending down
because of the fears that higher oil prices will derail world
economic growth."
 Advancing strongly, Teck Resources TCKb.TO rallied 2.5
percent to C$50.93, and Agnico Eagle (AEM.TO: Quote) climbed 1.3
percent to C$64.95 as gold and copper prices turned positive on
safe-haven flows and expectations of higher demand due to
construction needs in Japan. [GOL/] [MET/L]
 "There's obviously going to be some sort of rebuilding
effort. At the margin, it's going to be more demand for basic
materials," said Ian Nakamoto, director of research at
MacDougall, MacDougall & MacTier.
 "Bargain-hunters are coming in ... part of it has to do
with that we've been down pretty sharply yesterday and the past
few days. (They're) looking for some sort of rebound," Nakamoto
 The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE ended up 35.67 points, or 0.26 percent, at 13,674.25
with five of the index's 10 main sectors firmer.
 Forest-products companies were among the most significant
gainers of the day. International Forest Products IFPa.TO
surged 15 percent to C$6.00, West Fraser (WFT.TO: Quote) jumped 6.7
percent to C$50.83 and Canfor Corp (CFP.TO: Quote) gained 7.2 percent
to C$13.07.
 "The Japanese use a lot of lumber as opposed to cement in
their buildings because they can withstand earthquakes better
than pure concrete structures," added Orengo.
 ($1=$0.97 Canadian)
 (Reporting by Claire Sibonney; editing by Rob Wilson)