CANADA STOCKS-Energy, banks lead TSX to 1-wk high in broad rally

Mon Aug 29, 2011 5:04pm EDT
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 * TSX up 177.34 points, or 1.44 pct, at 12,504.85
 * Energy, financials drive gains
 * Gold miners fall 1.52 percent, sliding with gold prices
 (Adds analyst comment, updates to close)
 By Trish Nixon
 TORONTO, Aug 29 (Reuters) - Toronto's main stock index
advanced to a one-week high on Monday in a broad rally led by
energy and financial companies, as positive U.S. and European
news boosted investor appetite for riskier assets.
 World stocks rallied along with oil after a merger between
two major banks in Greece gave investors a rare bit of
encouraging news out of Europe. [MKTS/GLOB]
 An unexpected surge in U.S. consumer spending for July --
which indicated the economy was not falling back into recession
further boosted sentiment. [ID:N1E77S0BS]
 "It's a dim light, but still a light at the end of the
tunnel," said Serge Pepin, head of investments at BMO
Investments Inc. "Investors and market participants want to
cling to those positive numbers."
 All of the market's 10 main groups were stronger, with
energy stocks leading the way, up 2.6 percent. Canadian Natural
Resources CNQ.TO was the most heavily weighted climber,
jumping 3.47 percent to C$36.05.
 The heavyweight financial sector added 1.5 percent, with
Bank of Nova Scotia BNS.TO climbing 2 percent to C$52.35
ahead of its quarterly results, announced on Tuesday. Manulife
Financial MFC.TO, up 4.6 percent at C$13.29, was another top
 The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE close up 177.34 points, or 1.44 percent, at
12,504.85. Earlier it reached a session high of 12,523.92, its
strongest since Aug. 18.
 Monday's rally added to gains from Friday's session, when
markets started to embrace riskier assets after a speech from
U.S. Federal Reserve Chairman Ben Bernanke left the door open
for fresh stimulus for the U.S. economy.  [nN1E77R0GB]
 "Investors feel that there's a little bit more breathing
room from what the Fed had to say on Friday," Pepin added. "We
know that the Fed and the central banks are staying vigilant."
 Gold miners, down 1.52 percent as bullion prices tumbled,
held back the TSX, causing the index to underperform its U.S.
counterparts. [GOL/][.N]
 Among the biggest decliners, Barrick Gold ABX.TO lost 1.9
percent to C$49, and Goldcorp G.TO fell 1.3 percent to
 AuRico Gold AUQ.TO was the third heaviest laggard,
plunging more than 19 percent to C$11.05 after the company said
it will buy Northgate Minerals NGX.TO for C$1.46 billion to
create an intermediate-sized gold company. [nL4E7JT1Q9]
 ($1=$.98 Canadian)
 (Editing by Jeffrey Hodgson)