Toronto stocks start year with resource-led jump

Wed Jan 2, 2008 5:23pm EST
 
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By Leah Schnurr

TORONTO (Reuters) - Record high gold and oil prices propelled the Toronto Stock Exchange's main index more than 90 points higher on Wednesday, as it rang in the new year with robust gains by resource shares.

The materials sector led the advance, rising 3.8 percent, while its gold subsector soared 7.5 percent as the price of gold touched a record $861.10 an ounce, helped by a weaker U.S. dollar and international political tensions.

Meanwhile, the heavyweight energy sector climbed 2.1 percent as oil briefly hit the highly anticipated $100 a barrel mark amid violence in oil-producer Nigeria and tight energy stockpiles. Crude eased to $99.62, but was still up $3.64.

Barrick Gold (ABX.TO: Quote) rose C$3.87, or 9.3 percent, to C$45.65, while Canadian Natural Resources (CNQ.TO: Quote) was up C$1.57, or 2.2 percent, at C$74.15.

"Clearly what we're seeing is a strong rally on the commodities side, which I think has offset what we might otherwise have seen as a weak day with weaker news coming out of the U.S.," said Kate Warne, Canadian market strategist at Edward Jones in St. Louis, Missouri.

The S&P/TSX composite index .GSPTSE closed up 93.70 points, or 0.68 percent, at 13,926.76 in the first trading day of the year.

Despite the sharp advance, only four of the TSX's 10 main groups ended in positive territory.

The sharp rise came in contrast to markets south of the border, as U.S. stocks finished sharply lower on weak manufacturing data and heightened concerns about the outlook for the world's largest economy.   Continued...