UPDATE 2-Toronto stocks rebound as commodities gain

Tue Aug 19, 2008 12:58pm EDT
 
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(Updates to midday)

* TSX rebounds as commodity prices climb

* Resource shares pull index higher

* Banks lead downside amid more credit crunch woes

TORONTO, Aug 19 (Reuters) - The Toronto Stock Exchange's main index pushed higher on Tuesday, fueled by a rebound in commodity prices that overshadowed worries over the U.S. economy and more fallout from the credit crisis.

The index recovered from an earlier drop of more than 100 points as gold an oil prices reversed course to climb higher, lifting Bay Street's heavyweight energy and materials sectors. In the oil patch, Canadian Natural Resources CNQ.TO rose more than 4 percent.

But the broader market was held back by concerns over the outlook for the U.S. economy following data that suggested a further deterioration in the housing market, while wholesale prices jumped in July.

Financials sagged as shares were hurt by a forecast that U.S. investment bank Lehman Brothers LEH.N will likely take a further $4 billion in writedowns in the third quarter. See: [ID:nBNG259145]. Canadian Imperial Bank of Commerce CM.TO slid more than 3 percent.

The S&P/TSX composite index .GSPTSE was up 57.70 points, or 0.44 percent, at 13,177.07 but just three of its 10 main sectors were in positive territory.   Continued...