March 11, 2008 / 3:09 PM / 10 years ago

UPDATE 1-Toronto stocks up 230 points on cenbank action

(Adds details, analyst)

By Jonathan Spicer

TORONTO, March 11 (Reuters) - The Toronto Stock Exchange’s main index shot out of the starting gate on Tuesday, emboldened by a joint plan by the Bank of Canada and other central banks to inject liquidity into faltering world credit markets.

Canadian banks, which have lagged the overall TSX so far this year, led the charge with heavyweights Royal Bank of Canada (RY.TO) and Bank of Nova Scotia (BNS.TO) logging big gains.

Materials and energy shares also jumped, partly due to bullish commodity prices.

“Central banks have shown us that they will step up to the plate in order to alleviate some of the concerns,” said John Ing, president of Maison Placements Canada.

The S&P/TSX composite index .GSPTSE rose 236.62 points, or 1.8 percent, to 13,241.71, regaining much of the previous session’s steep decline.

U.S. and European equities also climbed after the Federal Reserve said it would work in tandem with other central banks to prop up credit markets, and accept a broader range of securities as collateral. For details, see: [nN11554482] and [nN11555322]

“The fact is that these steps are band-aids that reassure in the short term but do not resolve the central need for Americans to recapitalize their financial markets,” Ing said.

The financial sector logged its biggest intraday rise in 1-1/2 months, up 2.9 percent with Royal, the TSX’s biggest listing, up C$1.83 at C$47.23.

Scotiabank climbed C$1.48 to C$45.40.

Crude oil and base metals were in positive territory on commodities markets, boosting the TSX energy sector 1.6 percent and the materials sector 2.1 percent. The base metals and mining subsector added 1.1 percent.

Spot gold handed back earlier gains, but the TSX gold subsector still climbed 1.6 percent.

Potash Corp of Saskatchewan (POT.TO) was up C$6.09 at C$148.72, while Canadian Oil Sands Trust COS_u.TO advanced C$2.05 to C$44.00.

In the telecoms sector, Manitoba Telecom Services MBT.TO and Shaw Communications Inc (SJRb.TO) rose 2.4 percent and 2.6 percent respectively after the two firms submitted applications for wireless spectrum in a coming Canadian auction.

The TSX index fell 2.1 percent in the previous session.

$1=$0.99 Canadian Reporting by Jonathan Spicer, editing by Mario Di Simine

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