CANADA STOCKS-TSX rises on U.S. data, Tim Hortons as it awaits Fed

Tue Jun 18, 2013 11:42am EDT
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* TSX rises 72.78 points, or 0.59 percent, to 12,361.68
    * Nine of 10 main index sectors advance
    * Tim Hortons up 3.5 percent after investor exerts pressure
    * Gold-mining shares slip with price of bullion

    By John Tilak
    TORONTO, June 18 (Reuters) - Canadian stocks hit a one-week
high on Tuesday as stronger U.S. economic data boosted oil and
gas shares, while market focus was squarely on a U.S. Federal
Reserve meeting that might offer clues on the future of U.S.
monetary policy.
    Also boosting Canada's benchmark stock index, coffee chain
Tim Hortons Inc was up 3.5 percent on news that it now
faces pressure to make changes from another investor, U.S. hedge
fund Scout Capital Management, after recently outlining plans to
address the concerns of activist investor Highfields Capital.
    Sentiment was lifted further by data showing U.S. consumer
prices rose in May and that a gauge of underlying price
pressures indicated signs of stabilizing after a long decline.
    Front of mind, however, was speculation on whether the Fed
will shed light at the end of its two-day meeting on Wednesday
on when it might begin dialing back its bond buying program.
    "Even though the attention is on the Fed, I don't think the
market is sold on the idea that tapering is coming really soon,"
said Gareth Watson, vice president, investment management and
research, at Richardson GMP.
    "The U.S. economy is still creating jobs, and the housing
market appears to be getting better, but is it completely
planted on its feet? I don't think the Fed is convinced of that
     The Toronto Stock Exchange's S&P/TSX composite index
 was up 72.78 points, or 0.59 percent, at 12,361.68,
after earlier touching 12,376.47, its highest level since June
10. Nine of the 10 main sectors on the index were higher.
    Energy shares climbed more than 1 percent, benefiting from
the U.S. data that pushed up oil prices. In the group,
Suncor Energy Inc added 1.6 percent to C$31.75 and
played an influential role in leading the index higher.
    Financials, the index's most heavily weighted sector, gained
0.6 percent. Royal Bank of Canada, the country's biggest
lender, rose 0.9 percent to C$60.97.
    The jump in Tim Hortons, to C$55.75, helped the consumer
discretionary group climb 1.4 percent.
    "This is just a natural process where people are expecting
that perhaps with this investor stepping in, changes (at Tim
Hortons) could be afoot," Watson said. "There's no guarantee,
it's no slam dunk at all that that happens, but certainly
speculation picks up."
    Shares of gold producers tumbled 2.1 percent after a decline
in the price of bullion. 
    In a Reuters poll released on Tuesday, analysts predicted
the resource-heavy Toronto stock index, which has struggled to
gain traction in 2013, would kick into gear in the second half
of the year as the global economy rebounds.