CANADA STOCKS-TSX jumps to one-month high on European debt deal

Thu Oct 27, 2011 1:20pm EDT
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 * TSX extends gains, up more than 2 percent at midday
 * Financials, energy sectors lead gains
 * European leaders, banks strike deal on Greek debt
 By Jon Cook
 TORONTO, Oct 27 (Reuters) - Canadian stocks jumped more
than 2 percent to hit a one-month high on Thursday, buoyed by
optimism over a long-awaited deal among European policymakers
to tackle the region's debt crisis.
 Global stocks were lifted by an agreement on behalf of
European leaders that included a plan to leverage the euro
zone's bailout fund to 1 trillion euros, a 50 percent haircut
for private holders of Greek debt and bank recapitalization.
 "What we're seeing, at least at the outset, is a relief
rally," said Andrew Pyle, wealth advisor and associate
portfolio manager at ScotiaMcLeod. "Sustaining this is really
going to depend on whether the market actually believes this is
the beginning of something more constructive going forward."
 Financial stocks, up 2.5 percent, played the biggest role
in leading the market higher. Canadian banks have traded in
sympathy with European lenders for much of the crisis even
though they have little or no exposure to Greece.
 Royal Bank of Canada RY.TO did the most to lead financial
sector higher, posting a 3.1 percent gain to C$49.64.
 By midday, the Toronto Stock Exchange's S&P/TSX composite
index .GSPTSE was up 269.29 points, or 2.21 percent, at
12,455.35. It rose as high as 12,467.92, its strongest level
since Sept. 9.
 Energy stocks, up 3 percent, were also a major driver of
gains. Oil jumped to $112 a barrel as the European deal and
supportive U.S. data eased concerns that economic weakness
could curb energy demand. [O/R]
 Shares of Suncor Energy Inc SU.TO, up 4.5 percent at
C$32.68, led the sector.
 A 7 percent rally in base metal miners also help drive the
influential materials sector higher, as copper prices jumped on
the European news. [MET/L]
 Teck Resources TCKb.TO led the sector, gaining 8.4
percent to C$40.45 after news its third-quarter net income more
than doubled, driven by strong results from its coal and copper
businesses. [ID:nN1E79P2GI]
 First Quantum Mining FM.TO was also among the biggest
gainers, jumping 11.1 percent to C$20.67.
 After reporting a doubling in its third-quarter profit,
Potash Corp POT.TO shares were up 0.8 percent to C$50.16, as
strong grain prices boosted demand for the world's top
fertilizer maker's products. [ID:nN1E79P2GK]
 Fellow miner Barrick Gold ABX.TO climbed 0.2 percent to
C$48.29, after reporting a 45-percent increase in its quarterly
profit, driven by a sharp increase in bullion prices.
 In other Canadian company news, BlackBerry maker Research
In Motion Ltd's RIM.TO shares rose 0.6 percent to C$21.02, a
day after plunging nearly 8 percent. RIM was also hit by a
class action lawsuit filed by consumers in the U.S. and Canada
for a days-long service outage earlier this month.
 Solid U.S. economic news contributed to the market's
euphoria, as data showed third-quarter GDP growing at its
fastest pace in a year. [ID:nN1E79Q0FK]
 (Editing by Jeffrey Hodgson)