CANADA STOCKS-TSX rides energy and banks to higher close

Mon Dec 14, 2009 4:39pm EST
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 * TSX rises 121.76 points to 11,545.69
 * Hits highest level since Dec. 7
 * Energy and bank shares power latest rally
 (Adds details, comments and official numbers)
 By Frank Pingue
 TORONTO, Dec 14 (Reuters) - Toronto's main stock index rose
to a one-week high on Monday as a takeover by Exxon Mobil
raised optimism about energy sector acquisitions, while an Abu
Dhabi aid package for Dubai helped spark financials.
 Suncor Energy SU.TO, which headlined the overall rally,
rose 2.2 percent to C$37.09, while EnCana Corp ECA.TO shares
followed with a gain of 5.1 percent to C$31.55.
 The rally in energy shares came after news that Exxon
XOM.N will buy XTO Energy Inc XTO.N for about $30 billion
in stock, a move that thrusts the U.S. energy giant to the
forefront of North America's natural gas industry.
 "If you look at one sector where it really looks like there
might be lots of merger and acquisition possibilities it would
have to be the energy sector," said Elvis Picardo, analyst and
strategist at Global Securities in Vancouver.
 Heavily-weighted Canadian banks followed a rally in global
equities overnight which was set off by the news that Abu Dhabi
threw its debt-laden neighbor Dubai a $10 billion lifeline.
 "That's taken some of the risk concerns off the table and
so we're seeing pretty much a rally in financial stocks both
here and around the world," said Picardo.
 Shares of Bank of Nova Scotia BNS.TO rallied 1.3 percent
to C$48.13, while Royal Bank of Canada RY.TO ended up 0.7
percent at C$55.70.
 The S&P/TSX composite index .GSPTSE closed up 121.76
points, or 1.07 percent, at 11,545.69, reclaiming all of the
0.75 percent skid suffered last week.
 The close was just four points off the TSX's session high,
which had marked its highest level since Dec. 7.
 (Editing by Jeffrey Hodgson)