January 31, 2011 / 10:12 PM / in 7 years

CANADA STOCKS-TSX hits highest since Sept 2008 on oil rush

* TSX climbs 0.85 percent to 13,551.99

* Energy shares jump 2.74 pct as oil soars on Egypt woes

* Imperial Oil up 4.6 pct on strong results

TORONTO, Jan 31 (Reuters) - Toronto’s main stock index touched its highest level since September 2008 on Monday as the uprising in Egypt sparked a jump in the price of oil and a rally in energy shares.

Brent oil prices surged above $101 a barrel for the first time since 2008, while U.S. crude hit its highest point since October 2008 on concern that unrest in Egypt could spread to crude-producing countries in the Middle East or disrupt Suez Canal flows. [O/R]

As a result, oil and gas companies were among top gainers in Toronto on Monday. Suncor Energy (SU.TO) added 3.55 percent to C$41.46, while Canadian Natural Resources (CNQ.TO) climbed 3.64 percent to C$44.65. Husky Energy (HSE.TO) gained 3.53 percent to C$27, and Talisman Energy TLM.TO rose 3.61 percent to C$22.94.

“It’s all energy,” said Barry Schwartz, vice president and portfolio manager at Baskin Financial Services.

“My gut tells me that the market has overreacted and a lot of these gains that we’re seeing in the oil stocks will be given back in a month to come.”

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed up 114.41 points, or 0.85 percent, at 13,551.99. Eight of the index’s 10 sectors were higher, led by a 2.74 percent climb in the oil and gas group.

The index hit a high of 13,588.47 during the day, its highest point since Sept. 2, 2008.

Imperial Oil (IMO.TO) was also supported by stronger than expected quarterly results, boosting its shares 4.57 percent to C$44.65. [ID:nN31215060]

Over the coming weeks other big energy producers are also expected to post stronger fourth-quarter profits due to higher oil prices and improved refining profits, although weak returns from natural gas and pipeline woes may dampen gains. [ID:nN28263754]

$1=$1.00 Canadian Reporting by Ka Yan Ng; editing by Peter Galloway

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