UPDATE 1-Toronto stocks rise as commodities show strength

Fri Sep 12, 2008 11:31am EDT
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*Oil up on fears Hurricane Ike will damage U.S. refineries

*Gold, base metals track oil's rise, weaker U.S. dollar

*Financial stocks slip as market frets over Lehman

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TORONTO, Sept 12 (Reuters) - Strength in commodities powered the Toronto Stock Exchange's main index higher on Friday morning, but worries over the fate of Lehman Brothers Holdings Inc LEH.N lingered around financial shares.

The heavily weighted energy sector rose 2.6 percent as crude oil firmed to around $102 a barrel on concerns Hurricane Ike could threaten Gulf coast oil refineries. Husky Energy Inc (HSE.TO: Quote) rose 2 percent to C$42.93.

Also, Husky and several other companies won development rights to explore for gas off the coast of Labrador, the Canada-Newfoundland and Labrador Offshore Petroleum Board said.

The resource-laden materials group rose 5.2 percent on stronger gold and base metals prices. First Quantum Minerals FM.TO was up 7 percent at C$52.55, while Potash Corp of Saskatchewan Inc (POT.TO: Quote) , the world's biggest fertilizer maker, climbed 4.5 percent to C$169.23.

"The U.S. dollar is weak and that makes commodity prices higher," said Fred Ketchen, director of equity trading at ScotiaMcLeod.   Continued...