CANADA STOCKS-TSX gains on euro zone relief, golds drag

Wed Sep 14, 2011 5:44pm EDT
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 * TSX rises 87.90 points, or 0.72 percent, at 12,293.38
 * Nine of 10 main sectors higher
 * Energy stocks lead gains; golds drag
 (Adds details, analyst comment)
 By Trish Nixon
 TORONTO, Sept 14 (Reuters) - Toronto's main stock index
rose along with global equities on Wednesday, as European
leaders displayed new urgency in efforts to contain the euro
zone debt crisis.
 German and French leaders urged Greece to implement all
financial reforms "strictly and effectively" to ensure
continued euro zone assistance and reduce any chance of a debt
default. [ID:nP6E7JV05E]
 Adding to relief for investors, Italian Prime Minister
Silvio Berlusconi won a confidence vote on an austerity plan
for the euro zone's third-largest economy.
 "It appears that the confidence pendulum has swung in the
favor of European contagion not spreading, therefore world
growth not being threatened, therefore more confidence in
second half of 2011 growth," said Robert McWhirter, a portfolio
manager at Selective Asset Management Inc.
 Global sentiment received an early boost after Europe's top
bureaucrat said plans for a common euro zone bond, seen by many
as a key tool to ease the region's festering debt crisis, would
soon be presented. [ID:nL3E7KE09F]
 Shares of oil and gas companies, which have been hit hard
during recent downturns, gained 2.07 percent to lead Toronto's
 Suncor Energy SU.TO was the most influential advancer,
rising 3.1 percent to C$29.44, while Cenovus Energy CVE.TO
rose 3.5 percent to C$33.02 and Canadian Natural Resources
CNQ.TO added 2.2 percent to C$34.45.
 The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE closed the session up 87.90 points, or 0.72 percent,
at 12,293.38. Nine of the 10 main sectors were higher.
 The TSX added to gains made Tuesday, when the index snapped
a dramatic three-day losing streak. Global stock markets have
been roiled by uncertainty over the European debt crisis and
fears that Greece was on the tipping point of default.
 But McWhirter noted that from a technical analysis
perspective, North American markets have been moving up in a
channel and making effectively higher lows since early August.
 "It looks like European markets may be in the process of
trying to establish a bottom, which is similar to what happened
in North America and other markets," he said.
 "If so, then on a combined basis we may start to move
higher as we move towards the end of the year."
 Toronto's gold mining stocks dragged the broader materials
sector down 0.4 percent on Wednesday, causing the TSX to lag
U.S. market gains. The price of bullion fell as investors
stepped back into riskier markets and as price volatility over
the past month diminished the metal's safe-haven appeal.
 "(Gold stocks) fit in well to the short term rotational
volatility," said Michael Smedley, chief portfolio manager at
Morgan Meighen & Associates.
 "Nevertheless, the longer view is still of a strong gold
price ... It's going to continue to be a sector of interest."
 Goldcorp G.TO was the heaviest drag on the index, falling
1.8 percent to C$50.37, while Barrick Gold ABX.TO lost 1.1
percent to C$52.16.
 In Canadian company news, shares in Bombardier Inc
BBDb.TO fell 1.4 percent to C$4.20 after Delta Air Lines
DAL.N repeated that it had no plans for further plane
purchases. [ID:nS1E78D0MM]
 Shares of Silvercorp SVM.TO rebounded 3.7 percent to
C$6.43 after the China-focused miner offered a detailed
rebuttal of new anonymous allegations of fraud, releasing
figures on taxes, production and assay grades to fend off a
short-seller attack. [ID:nS1E78D0YV]
 (Editing by Jeffrey Hodgson)