CANADA STOCKS-Energy leads TSX rebound as Europe debt fears ease

Wed Sep 7, 2011 5:32pm EDT
 
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 * TSX up 202.02 points, or 1.61 percent, at 12,720.56
 * All 10 sectors higher
 By Trish Nixon
 TORONTO, Sept 7 (Reuters) - Toronto's main stock market
index snapped a three-day losing streak on Wednesday as
sentiment turned after Germany's top court cleared the way for
Berlin to contribute more to the euro zone's rescue fund.
 Wall Street rebounded more than two percent and European
stocks bounced back from a two-year low after the court
rejected lawsuits aimed at blocking the country's participation
in aid to Greece and other nations, giving relief to investors
after this week's sharp sell-off in risk assets. [MKTS/GLOB]
 "Stocks are pretty well oversold ... At this point, where
valuations are, anything other than a recession in the U.S. is
probably going to be bullish for equities," said Robert Kavcic,
economist at BMO Capital Markets.
 Beaten-down energy stocks rallied to lead the index's
gains, jumping 2.4 percent as the price of oil rose to a
five-week high. [O/R]
 Suncor Energy (SU.TO: Quote) was the most heavily weighted gainer,
up 3.7 percent at C$30.36, while Canadian Natural Resources
(CNQ.TO: Quote) added 3.2 percent to C$35.66.
 Financial issues also recovered some of their recent
losses, rising 1.7 percent. Royal Bank of Canada (RY.TO: Quote)
climbed 1.8 percent to C$49.07, while Bank of Nova Scotia
(BNS.TO: Quote) jumped 2 percent to C$53.25.
"Other than financials we are seeing cyclicals carry most of
the strength today," Kavcic said.
 "For the past three or four months we've seen defensive
sectors outperform pretty significantly, as economic growth
expectations have been ratcheted down. Today we are seeing a
little bit of the opposite."
 Base-metal miners rose with the price of copper and other
minerals. The broader materials sector gained 1 percent, even
as gold mining stocks, which have supported the index in recent
downturns, weighed as they tracked the price of the safe-haven
metal lower. [MET/L] [GOL/]
 Teck Resources (TCKb.TO: Quote) was among the most influential
advancers, up 3.7 percent at C$42.85. Yamana Gold (YRI.TO: Quote) was
the heaviest drag, falling 1.9 percent to C$16.46, while Osisko
Mining (OSK.TO: Quote) sank 3 percent to C$14.15.
 The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE closed up 202.02 points, or 1.61 percent, at
12,720.56, its strongest level since September 1. All ten of
the index's main sectors were higher.
 "The market is hopeful that this will be a turnaround
week," said Barry Schwartz, vice president and portfolio
manager at Baskin Financial Services, stressing the need for
politicians to take action on issues such as jobs, debt and
growth.
 "If some of these things come together, the valuations on
stocks are so cheap and interest rates are so low ... we could
be set up for an explosive rally."
 U.S. President Barack Obama is due to lay out a
job-creation package on Thursday and G7 finance ministers and
central bankers meet in Marseilles, France this weekend to
discuss measures to boost global economic growth.
 (Editing by Jeffrey Hodgson)