UPDATE 3-Toronto stocks get big boost from rate cuts

Tue Jan 22, 2008 4:58pm EST
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(Updates with official closing number, adds detail)

TORONTO Jan 22 (Reuters) - The Toronto Stock Exchange's main index climbed more than 500 points on Tuesday, ending a five-day plunge, after Canada and the United States cut interest rates to calm worries over the global economic outlook.

In a broad-based advance led by the materials, energy and financial sectors, the index regained more than two-thirds of Monday's losses, while investors took advantage of the beaten-down prices.

But the index remained at near lowest level in a year after a nosedive sparked by intensifying fears over the prospect of a U.S. recession and what that could mean for global growth.

The S&P/TSX composite index .GSPTSE closed up 508.76 points, or 4.19 percent, at 12,640.89 with all of its 10 sectors on the upside.

Fairfax Financial Holdings FFH.TO and Research In Motion RIM gave the market its biggest boost, rising C$10.75, or 3.8 percent, to C$296.40, and C$8.78, or 10.4 percent, to C$93.28 respectively.

The materials sector gained 8.4 percent, while the subsector of gold producers soared 7.5 percent. Barrick Gold ABX.TO was up C$4.78, or 10.3 percent, at C$51.25, while Kinross Gold K.TO rose C$3.01, or 15.3 percent, to C$22.67.

The energy and financials sectors added 2.8 percent and 3.7 percent respectively. Petro-Canada PCA.TO moved up 75 Canadian cents, or 1.6 percent, to C$46.90, and Bank of Montreal BMO.TO C$2.24, or 4.4 percent, to C$53.64.

An emergency interest rate of 75 basis points from the U.S. Federal Reserve, closely followed by a cut of 25 basis points from the Bank of Canada gave the Toronto benchmark a shot in the arm and helped it climb out of a five-session rout.

The freefall that begain last Tuesday knocked 1,566.15 points, or 11.4 percent, off the index. The dive was capped off by a more than 600-point plunge on Monday, the biggest one day drop in more than seven years.

($1=$1.03 Canadian) (Reporting by Leah Schnurr)