November 17, 2010 / 4:11 PM / 7 years ago

REFILE-CANADA STOCKS-TSX edges higher as resource shares rebound

3 Min Read

 (Delete extraneous number 12 from paragraph 7)
 * TSX up 34.52 points at 12,636.75
 * Energy, materials lead TSX higher
 * Potash firms after announcing $2 bln stock buyback  (Adds details, quotes)
 By Jennifer Kwan
 TORONTO, Nov 17 (Reuters) - Toronto's main stock index bounced higher on Wednesday morning after a weak start, boosted by a turnaround in commodity-linked issues.
 The market had opened lower as resources faltered on fears that China would increase interest rates to fight inflation, raising concerns of a drop in Chinese demand for commodities. [ID:nSGE6AG08D]
 But the resource sectors regained their footing, with the energy and materials groups up 0.1 percent and 1.5 percent, respectively, as investors digested an announcement by China on Wednesday that was less draconian than anticipated, said Rick Meslin, head of Canadian equities at UBS.
 "For the last few days, the market was fearing what might be serious monetary tightening... But now people are sort of sifting through what this means," said Meslin.
 "They didn't move to tighten rates, but there are certain types of restrictions that are likely."
 As well, gold futures steadied, in part after U.S. data showed that an increase in October's year-on-year core consumer price index was the smallest on record, and as housing starts fell to their lowest level in 1-1/2 years. [GOL/]
 At 10:26 a.m. (1526 GMT), the Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was up 34.52 points, or 0.27 percent, to 12,636.75. Two of the main index's groups were higher.
 Movers on the upside included Barrick Gold (ABX.TO), up 1.5 percent at C$50.73, and Cameco Corp (CCO.TO), which climbed 2 percent to C$34.98. Teck Resources TCKb.TO rose 2 percent to C$49.10.
 Meslin said investors were also cautiously optimistic as they awaited more clarity on how a European Union-IMF mission would help ease Ireland's debt crisis.
 Ireland has agreed to work with the mission to shore up its banking sector, a process that could lead to a bailout, despite Dublin's deep reluctance. [ID:nLDE6AG004]
 Nervousness over global economic worries showed up as weakness in TSX financials. Royal Bank of Canada (RY.TO) was down 0.6 percent at C$52.78, while Bank of Nova Scotia (BNS.TO) fell 0.4 percent to C$52.44. Toronto-Dominion Bank (TD.TO) slid 0.6 percent to C$72.39.
 Potash Corp (POT.TO) rose 0.2 percent to C$138.43 after the fertilizer maker announced plans for a stock buyback worth up to $2 billion. [ID:nN16156346]
 ($1=$1.02 Canadian)  (Reporting by Jennifer Kwan; editing by Rob Wilson)                                        

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