CANADA STOCKS-TSX rallies as EU hopes drive commodities higher

Fri Nov 11, 2011 5:25pm EST
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 * TSX up 167.98 pts, or 1.4 pct, at 12,276.85
 * Italian senate passes austerity measures package
 * Mining stocks lead rally
 (Adds analyst's comments, details)
 By Jon Cook
 TORONTO, Nov 11 (Reuters) - Toronto's main stock index
ended a volatile week of trading more than 1 percent higher on
Friday as commodity prices rose on renewed investor optimism
that Europe is taking steps to deal with its debt crisis.
 Moves by debt-riddled Italy and Greece to grapple with the
crisis provided a much-needed lift to global stocks, which have
swayed with the headlines from Europe for the last month.
 The Italian senate passed an EU-mandated package of
austerity measures to address the country's near 2 trillion
euro (2.7 trillion) debt. Approval by the lower house on
Saturday was seen as a matter of course, relieving market
anxiety that Italy would become the euro-zone's next bailout
case. [MKTS/GLOB]
 In Greece, a new coalition government was proceeding on a
plan to secure an 8 billion euro aid tranche to prevent it from
running out of cash next month. [ID:nA8E7MA00N]
 Adding to the positive sentiment from Europe, the U.S.
economy showed signs of shaking off its doldrums this week,
with a new Thomson Reuters/University of Michigan index on
consumer sentiment rising to its highest level in five months.
[ID:nN1E7AA0I3] This came on the heels of a dip in U.S. jobless
 "When the political news is neutral the global growth story
shines through, the markets tend to rally," said Stephen Wood,
chief investment strategist forth North America at Russell
 After two straight down sessions, the Toronto Stock
Exchange's S&P/TSX composite index .GSPTSE ended the week up
167.98 points, or 1.4 percent, at 12,276.85.
 The index's heavily weighted materials sector, home to
base-metal and gold miners, surged 2.5 percent, nearly erasing
Thursday's losses.
 Goldcorp Inc (G.TO: Quote) led the sector, rising 4.4 percent to
C$54.58 as bullion prices increased for the third straight
week. [GOL/]
 Base metals miners performed strongly, boosted by copper's
first gain in nearly a week [MET/L], jumping 2.4 percent. The
sector was led by First Quantum Minerals (FM.TO: Quote), which was up
more than 4 percent at C$18.97 after falling more than 20
percent the last two sessions.
 "Commodity prices look like they have some bounce to them,"
said Paul Taylor, chief investment officer at BMO Harris
Investment Management Inc.
 "If we get by the euro zone issues again, the economic
indicators are inconsistent with an outright global economic
recession, so that's not a bad backdrop for what we produce in
abundance here in Canada," Taylor said.
  Teck Resources TCKb.TO was also among the sector's top
gainers, rising 1.5 percent to C$38.31.
  Nine of the index's 10 main sectors were higher, with
energy and financials showing solid gains.
  Suncor Energy Inc (SU.TO: Quote) climbed 2.4 percent to C$32.36
to lead energy stocks, which rose 1.5 percent as oil prices
rode the commodities wave. [O/R]
  TransCanada Corp (TRP.TO: Quote) was the next biggest gainer,
rising 2.4 percent to C$40.81, a day after the United States
announced it would delay a decision on whether to approve its
proposed $7 billion Keystone XL pipeline for 18 months.
  Financial stocks were led higher by Royal Bank of Canada
(RY.TO: Quote), whose shares rose 1.4 percent to C$45.65.
  Power Financial Corp's PWF.TO shares were up 2.4 percent
at C$26.11 after it reported a higher profit due to stronger
results at its insurance and mutual fund subsidiaries.
 ($1=$1.01 Canadian)
 (Editing by Peter Galloway)