CANADA STOCKS-TSX rallies more than 2 pct on resources, BMO

Tue Aug 23, 2011 5:31pm EDT
 
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 * TSX ends up 269.97 points, or 2.24 pct, at 12,338.33
 * Nine of 10 sectors stronger, gold miners sink 4 pct
 (Updates with details, comments)
 By Claire Sibonney
 TORONTO, Aug 23 (Reuters) - Toronto's main stock index
posted its biggest gain in nearly two weeks on Tuesday as
resource issues rose with commodity prices and financial issues
jumped on surprisingly strong Bank of Montreal earnings.
 Canadian investors also took a cue from U.S. markets, where
many players jumped back into stocks before a highly
anticipated speech by U.S. Federal Reserve Chairman Ben
Bernanke later in the week, which could signal more stimulus
for the economy.
 Energy and financial issues powered the TSX's gains as oil
rose on increased risk appetite and continued fighting in
Libya, while the first of a wave of Canadian bank earnings due
over the next two weeks beat estimates. [O/R]
 Among the most heavily weighted gainers, Canadian Natural
Resources (CNQ.TO: Quote) surged 6 percent to C$34.88, while Bank of
Montreal (BMO.TO: Quote) jumped 4.3 percent to C$59.80 after it
reported 18 percent profit growth due to stronger capital
markets revenue and a recent acquisition. [ID:nN1E77L0PK]
 "Investors are just desperate for some good news out there
and they've been buffeted by the volatilities from the
political inertia both in Europe and the U.S. to deal with some
of these problems," said Michael Sprung, president at Sprung &
Co Investment Counsel.
 He noted that data out of China on Tuesday showing
manufacturing growth was slowing only slightly was positive for
the outlook on commodities, lifting copper prices in
particular. [MET/L]
 The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE ended up 269.97 points, or 2.24 percent, at 12,338.3,
its strongest one-day rally since Aug. 10. Nine of the 10 main
groups were firmer, as materials were dragged down by sliding
gold miners.
 The biggest heavyweight gainer on the index was Potash Corp
(POT.TO: Quote), which climbed 6.1 percent to C$53.81 after it was
upgraded to "outperform" from "sector perform" by Scotia
Capital.[ID:nWNAB1801]
 Holding back the day's big gains, precious-metal stocks
plunged almost 4 percent as the price of gold tumbled from its
first ever foray above $1,900 an ounce in the sharpest one-day
drop in 18 months. [GOL/]
 Goldcorp Inc (G.TO: Quote) sank 5.3 percent to C$50.79, while
Barrick Gold (ABX.TO: Quote) dropped nearly 3 percent to C$50.10.
 While market players were focused on Bernanke's speech at
the annual central bank conference in Jackson Hole, Wyoming, on
Friday, they were careful in their predictions about what he
would say, shying away from suggestions that he would launch
another round of Fed quantitative easing.
 "I would suggest that (the Fed) is going to be very careful
not to say things that could further disrupt the markets,"
Sprung said, adding that he expects the recent spate of market
swings to prevail for some time.
 Bruce Latimer, a trader at Dundee Securities, said BMO's
results were a positive start to the bank earnings season, but
cautioned that investors in general are still very wary.
 "We're in that sort of odd trading scenario - whether it's
every year or every two to three years - where investors have
been sticking their toe in the water and getting their ankle
bit off. And after a while they just stop doing that," he
said.
($1=$0.99 Canadian)
 (Reporting by Claire Sibonney; editing by Peter Galloway)