CANADA STOCKS-TSX rallies as oil rises, U.S. bank fears ebb

Tue Feb 24, 2009 5:17pm EST
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* TSX rallies 2.77 percent to 7,859.33

* Financials jump 7.2 percent as US bank fears subside

* Energy issues up 5.5 percent on oil price

* Materials retreat 5.2 percent on gold (Adds details, quote)

By Jennifer Kwan

TORONTO, Feb 24 (Reuters) - Toronto's main stock index closed sharply higher on Tuesday as oil and gas issues climbed with rising crude prices, while financials strengthened as fears over the fate of the troubled U.S. banking sector eased.

In see-saw action, the benchmark index swung nearly 300 points from trough to peak, with the upside supported by strength in energy issues as oil settled nearly 4 percent higher at $39.96 a barrel. [ID:nSIN379847] The main pressure to the downside came from weaker gold prices.

Oil and gas stocks rose 5.5 percent, while the materials sector, home to gold-mining stocks, sank 5.2 percent.

The heavily weighted financial services sector led the TSX higher, and finished the day up 7.2 percent. The sector followed U.S. stocks higher after Federal Reserve Chairman Ben Bernanke signaled that nationalization of major U.S. banks was not at hand. [ID:nN24405808]   Continued...