CANADA STOCKS-TSX heads higher as oil, gold strengthen

Thu Jun 25, 2009 10:39am EDT
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* TSX up 1.16 percent, at 10,218.10

* Energy sector, up 1.9 percent, leads rally (Adds details, quotes)

By Jennifer Kwan

TORONTO, June 25 (Reuters) - Toronto's main stock market index rose broadly on Thursday morning as firmer oil and gold prices boosted the TSX index's heavily weighted resource sectors.

The energy sector rose 1.9 percent as the price of oil climbed above $69 a barrel. [ID:nSP191786] Canadian Natural Resources CNQ.TO rose 3.3 percent to C$58.62 and Suncor Energy SU.TO climbed 2.6 percent to C$34.20.

The mining-heavy materials group rose 1.8 percent. Goldcorp G.TO was up 2.9 percent at C$41.66.

The TSX's strength on Thursday belies increased caution in the market following the index's big runup in recent months, said Rick Meslin, head of Canadian equities at UBS.

"It is an arm wrestle now, with certainly a lot more caution in the market than there has been in the past two months," said Meslin. "But there's a lot of cash left to deploy and people want to make sure they get set up for the month end, quarter end trade."

"This is more a sentiment and positioning trade than some sort of material and fundamental reason as to why things are up today.".   Continued...