CANADA STOCKS-TSX surges as economic hope drives commodities

Thu Aug 13, 2009 4:41pm EDT
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* TSX rises 1.55 percent to 10,825.56

* Mining, energy, industrials lead broad rally

* Surprise European growth helps sentiment

TORONTO, Aug 13 (Reuters) - Toronto's main stock index rose sharply on Thursday as surprisingly strong European economic data buoyed sentiment and commodity prices, sparking a resource-led rally.

Reports showing recessions in Germany and France ended in the second quarter overshadowed disappointing U.S. retail sales and weekly jobless claims data, and allowed investors to become increasingly more comfortable with risk in their portfolios.

Copper rallied to a 10-month peak on the strong sentiment and gold rose on concerns about inflation, boosting the TSX index's materials sector by 2.84 percent. Energy issues gained 1.88 percent as oil also ended higher.

"It does seem as though it's the premise that the North American and global economies are strengthening," said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.

"It's a good rally on the back of that sentiment."

Among materials issues, Pan American Silver PAA.TO jumped 10.4 percent to C$22.53, and copper and gold producer Quadra Mining QUA.TO rose 7 percent to C$12.51.   Continued...