April 21, 2009 / 9:17 PM / 8 years ago

CANADA STOCKS-Financials, energy issues power TSX higher

* TSX rises 1.3 percent to 9,247.17

* Gains follow 3.3 percent tumble on Monday

* Rise in oil prices lifts energy issues

* Financials climb on optimism for U.S. banks (Adds details)

By Cameron French

TORONTO, April 21 (Reuters) - Toronto’s main stock index made solid gains on Tuesday, spurred by stronger oil prices and optimistic comments from U.S. Treasury Secretary Timothy Geithner, while Teck Cominco TCKb.TO soared 37 percent on news it had deferred billions in debt payments.

The modest climb in oil prices boosted the heavily weighted energy group by 1.86 percent, while financials climbed 2.8 percent after Geithner said the majority of U.S. banks have more capital than they need in order to be be considered well capitalized. [ID:nN21535633].

“The financials were very strong on both sides of the border,” said Elvis Picardo, a strategist at Global Securities in Vancouver.

“I think the treasury secretary’s comments served to give investors some assurance.”

Bank of Nova Scotia (BNS.TO) surged 5.6 percent to C$34.33, while insurer Sun Life Financial (SLF.TO) gained 5.5 percent to C$28.32.

All told, the S&P/TSX composite index .GSPTSE climbed 121.02 points, or 1.33 percent, to 9,247.17, overcoming weakness just after markets opened. Eight of the TSX’s 10 main sectors rose during the session.

The gain follows a 3.3 percent tumble in the previous session, but comes as equity markets have been on a steady, upwards trajectory since early March.

“There’s been this change in sentiment over the past 5 weeks, and I think it’s really heartening to note investors coming back after the big decline we had yesterday,” said Picardo.

The TSX index is up 22 percent since March 9, despite continued worries over the strength of the global economy and the health of the international banking system.

“It seems like a lot of the bad news is kind of being ignored,” said Jennifer Radman, a portfolio manager at Caldwell Investment Ltd.

“I think a lot of people are looking for a pullback, and it would actually be maybe more of a relief if the market stopped for a bit and then resumed from there.”

Before markets opened, the Bank of Canada predicted the economy would contract a deeper than expected 3 percent this year, as it cut its benchmark interest rate to 0.25 percent and said the rate would stay in place for the next year.

Radman said the move likely had little or no impact on the stock market.

Among individual movers, Teck Cominco leapt 36.9 percent to C$12.47 after the miner said its lenders had agreed to defer US$4.4 billion in debt payments due in 2009, giving it breathing room in its attempt to pay down debt from its purchase of Fording Canadian Coal Trust.

Gold mining stocks were the lone area of weakness on the market, falling 2.67 percent as gold prices eased, following their big gains in the previous session.

Top producer Barrick gold (ABX.TO) fell 4.1 percent to C$34.67, while Goldcorp (G.TO) slid 4.5 percent to C$33.34.

$1=$1.24 Canadian Reporting by Cameron French; editing by Rob Wilson

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