CANADA STOCKS-TSX rises, set for biggest weekly gain in 19 months
* TSX rises 16.93 points, or 0.14 percent, to 12,510.19 * Six of 10 main index sectors rise * Gold-mining shares drop 1.5 percent on weaker bullion By John Tilak TORONTO, July 12 (Reuters) - Canada's main stock index rose on Friday as gains in energy and financial stocks offset weaker materials shares, with the U.S. Federal Reserve's support for monetary stimulus putting the index on track to post its biggest weekly gain in 19 months. Investors also processed mixed U.S. earnings reports, with more robust results from top banks overshadowing a profit warning from UPS. Federal Reserve Chairman Ben Bernanke said on Wednesday that the U.S. central bank must keep a stimulative monetary policy in place due to weak to inflation levels and a high unemployment rate.. That sparked a rally in global equity markets and caused a 1.5 percent jump in Toronto stocks on Thursday. "We're really seeing some positive follow-through from the response yesterday to Bernanke's comments," said Michael Sprung, president of Sprung Investment Management. "It's a ying-yang scenario," he added. "If they have to hold interest rates down, it's signaling that the recovery is not strong enough to be self-sufficient." "But investors are taking the view that as long as interest rates are held down, the recovery can continue to gather momentum," Sprung said. The Toronto Stock Exchange's S&P/TSX composite index was up 16.93 points, or 0.14 percent, at 12,510.19, after reaching and 12,519.65, its highest since June 5. Six of the 10 main sectors on the index were higher. Energy shares were up slightly, helped by a rise in the price of oil. Financials, the index's most heavily weighted sector, gained 0.2 percent. Royal Bank of Canada, the country's biggest lender, added 0.3 percent to C$61.80. In company news, Bank of Nova Scotia withdrew its application to acquire a nearly 20 percent stake in Bank of Guangzhou after Chinese authorities decided against proceeding with the C$719 million ($691.28 million) deal. Shares of Scotiabank gained 0.4 percent to C$57.16. But the materials group, which includes mining stocks, gave back 1 percent. A lower bullion price took gold producers down 1.5 percent. Barrick Gold Corp fell 1.4 percent to C$15.63, and Goldcorp was down 1.4 percent, at C$26.83. "People are worried any further declines in commodity prices could have an effect on those companies and industries," Sprung said. The valuations of material stocks are becoming more appealing, he added. Investors need to "find the ones that have the financial wherewithal to survive a prolonged period of low prices."
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