UPDATE 1-Toronto stocks tack on gains, rate cuts seen

Thu Apr 17, 2008 10:40am EDT
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(Adds details, analyst comments)

TORONTO, April 17 (Reuters) - The Toronto Stock Exchange's main index advanced on Thursday morning, led by hot energy stocks and emboldened by Canadian inflation data that leaves the door wide open to further interest rate cuts.

The oil and gas sector jumped 1 percent as crude oil futures rebounded from earlier losses, and natural gas futures steadied.

Meanwhile, inflation slowed more than expected last month, leading analysts to suggest the central bank would be more inclined to cut rates with inflation under control. For details, see: [nN17345313]

But some sectors of the Canadian benchmark index remained in the red as investors locked in profits from a recent rise in stocks.

"It's short-term relief," said Beste Alpargun, vice-president of equity research at Citadel Securities in Halifax. "These days we are hanging on to positive news to get through the day."

The S&P/TSX composite index .GSPTSE was up 53.35 points, or 0.4 percent, at 14,152.83. In the previous session, the index rose nearly 250 points.

By mid-morning on Thursday, Suncor Energy (SU.TO: Quote) added C$2.01 to C$116.39, and Canadian Natural Resources (CNQ.TO: Quote) was up C$1.24 at C$85.39, while U.S. crude futures hovered near a record high around the $115 per-barrel mark.

Other sectors on positive terrain included materials, up 0.3 percent, and consumer staples, up 0.4 percent.   Continued...