September 29, 2010 / 3:37 PM / 7 years ago

CANADA STOCKS-Resources, banks drive TSX to 2-year high

4 Min Read

   * TSX touches high of 12,345.92
 * Energy, resource, tech shares rise
 * Gold miners fall despite record-high gold  (Updates with details, commentary)
 By Claire Sibonney
 TORONTO, Sept 29 (Reuters) - Toronto's main stock index climbed to its highest level in two years on Wednesday, as a solid banking sector and rising commodity prices saw investors push the TSX through a key resistance level.
 The index rose as high of 12,345.92, its best level since September 2008, surpassing the previous 2010 high reached in late April, which had acted as a recent barrier.
 After stumbling earlier in the day, the TSX was firing on two of its three of its most powerful cylinders -- the energy sector, up 1.1 percent, and financials, up 0.1 percent.
 Materials were down 0.1 percent as soft gold shares weighed, but the sector's base-metals component rose 0.5 percent.
 Robust manufacturing data from China, a broadly weaker U.S. dollar and a drop in oil in storage in the United States pushed up some commodity shares, offsetting a revival of euro-zone sovereign debt fears.
 At 12:49 p.m. (1649 GMT), the Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was up 44.68 points, or 0.36 percent at 12,323.56. Eight of the 10 main groups were stronger.
 Heavyweight gainers included oil company Canadian Natural Resources (CNQ.TO), which gained 1.7 percent at C$35.17, miner Teck Resources TCKb.TO which added 2.3 percent to C$42.26, and Bank of Nova Scotia (BNS.TO), which advanced 0.7 percent to C$54.52.
 "Canada as a whole has outperformed most of the global economies and obviously our stock market has benefited from that," said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.
 "Our financial sector for instance was quite insulated from the shocks that hit the rest of the global financial markets ... and you've also seen commodity prices rebound quite nicely over the past year and a half."
 Gold prices also rallied, hitting their 10th record high in 12 trading days on fears that moves by the U.S. Federal Reserve to tackle the sluggish U.S. economy would undermine the greenback. But gold mining shares fell 0.3 percent.
 Goldcorp Inc (G.TO) slipped 0.6 percent to C$45.29, while Barrick Gold Corp (ABX.TO), the world's No. 1 producer,  was flat at C$48.27.
 Market players have recently expressed concerns that prices for the precious metal may have hit their peak, weighing on the prospects for producers.
 Technology stocks gained 1.7 percent as Research In Motion RIM.TO jumped more than 3 percent to C$49.87, following the introduction this week of the BlackBerry Playbook. [ID:nN2871674]
 "The challenges are that investor sentiment is still very skittish, still very fragile and sentiment has turned on the dime in the past few months," said Picardo.
 "So a lot depends I would think on the situation in the U.S. and there are plenty of cautionary signs even now," he added, pointing to continued weakness in employment and the housing sector.
 ($1=$1.03 Canadian)  (Reporting by Claire Sibonney; editing by Rob Wilson)                                        

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