CANADA STOCKS-TSX extends week-long rally as oils gain

Fri Feb 18, 2011 11:17am EST
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   * TSX up 13.26 points, or 0.09 pct at 14,149.41
 * Six of the 10 main groups higher
 * Index near 2-1/2 year intraday highs
 (Updates with details, comment)
 By Solarina Ho
 TORONTO, Feb 18 (Reuters) - Toronto's main stock index
nudged modestly higher on Friday, extending a week-long rally
as strength in energy stocks offset weakness among financial
 Six of the index's 10 main groups were higher, with energy
issues up 0.47 percent. Most stocks were up only modestly,
however. Suncor Energy (SU.TO: Quote) led among the gainers, but
advanced just 0.45 percent to C$44.68.
 U.S. crude futures rose as investors looked to cover short
positions and ahead of the U.S. Presidents Day holiday on
Monday, while tensions in the Middle East remained in focus.
 At 10:39 a.m. (15:39) GMT, the Toronto Stock Exchange's
S&P/TSX composite index .GSPTSE was up 13.26 points, or 0.09
percent at 14,149.41. The index was near 2-1/2 year intraday
highs, after surging past the 14,000 mark earlier in the week.
 Offsetting the energy gains was a 0.18 percent decline
among the hefty financial stocks, following six straight
sessions of gains that saw the group advance 3 percent.
 Sun Life Financial (SLF.TO: Quote) was down 0.58 percent at
C$32.83 while National Bank of Canada (NA.TO: Quote) was off 0.48
percent at C$74.64.
 Tame Canadian inflation data and China's decision to hike
banks reserve requirements provided little direction ahead of
the long weekend.
 The TSX will be closed on Monday for Ontario's Family Day
holiday, while four other province, including Alberta, are also
observing a holiday on Monday.
 Canada's annual inflation rate slipped to 2.3 percent in
January, bucking a global trend that has seen other countries
working to keep rising prices under control. [ID:nN18254283]
 "It's still pretty benign," said John Kinsey, portfolio
manager at Caldwell Securities Ltd.
 "There's two things going on there: The food situation is
causing inflation to go up, but the labor markets are still
under pressure, so that kind of puts a cap on wages. One part
is going up and the other isn't," Kinsey said.
 Overseas, China raised required bank reserves to a record
19.5 percent, in the latest move by the huge consumer of
commodities like oil and metals to curb inflation.
 "It usually has a bit of a knee-jerk reaction initially and
then people seem to shrug it off," said Kinsey.
 "It's kind of a funny thing, the reason that they do it is
because the economy is doing well. And, of course, if the
economy is doing well they need more commodities. So it goes
around in a circle."
 The influential materials group, which make up just under a
quarter of the index's weigh and is home to mining firms, was
up 0.17 percent. Stocks within the group were mixed, however,
with diversified miner Teck Resources TCKb.TO leading
decliners, sliding 1.29 percent to C$55.15.
 ($1=$0.98 Canadian)
 (Reporting by Solarina Ho; editing by Rob Wilson)