TSX jumps 200 points on commodity strength
By Jennifer Kwan
TORONTO (Reuters) - The Toronto Stock Exchange's main index rose for the fourth straight session on Wednesday as strength in commodities overpowered a steep decline by BCE Inc (BCE.TO: Quote) after the telecom giant said its leveraged buyout deal was in doubt.
The index's big energy group was up 7.9 percent as oil rose $3.67 to settle at $54.44 a barrel, tracking a rally in U.S. stocks and after China cut interest rates. In the energy group, Canadian Natural Resources (CNQ.TO: Quote) rose 12 percent to C$49.00.
Materials advanced 6.5 percent, helped by a rise in base metal prices as investors bet China's rate cut would help boost demand.
"China cut its interest rates today and that is felt to be good news for demand for commodities from the biggest emerging market," Gavin Graham, director of investments at BMO Asset Management.
"Looking at it, you would say it is a reflection of the return of the demand story from the emerging markets," he said.
The S&P/TSX composite index .GSPTSE finished up 200.66 points, or 2.38 percent, at 8,643.52, with nine of its 10 main groups higher. The index fought back from a 2.6 percent drop earlier in the day.
When asked whether the four-day winning streak was a sign the market is ready to keep moving higher, Graham said: "Too early to say that we definitively have seen the bottom."
Shares of BCE, Canada's biggest telecom company, sank 34.2 percent to C$25.25 as a plan by Ontario Teachers' Pension Plan and private equity funds to take the company private in the world's largest leveraged buyout looked to be in jeopardy. Continued...