TORONTO (Reuters) - Toronto’s main stock index rose to a two-week high on Monday after a pledge from the Group of 20 to pursue economic stimulus measures until recovery is in place encouraged investors to let go of the safe-haven U.S. dollar and embrace riskier assets.
Suncor Energy rose 5.5 percent to C$37.35 to lead all heavyweight gainers, while Goldcorp advanced 4.6 percent to C$46.49.
Financial issues were also big contributors to the rally, with several banks among the index’s top 10 gainers. Toronto-Dominion Bank climbed 3.1 percent to C$66.59, and Royal Bank of Canada rose 2.2 percent rise to C$56.44.
“The No. 1 driver was the weakness in the U.S. dollar. Everybody is marching to that drum,” said Sal Masionis, stockbroker at Brant Securities.
The dollar fell to a 15-month low against a basket of major currencies on Monday after the Group of 20 finance ministers and central bankers said at the end of a weekend meeting in Scotland that while the global economy has improved, recovery is still uneven and depends on policy support, which they vowed to provide until recovery was assured.
“This is probably as good as it gets for the TSX,” said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.
He added while the main driving force higher were the G20 comments, strength in oil prices also helped to lift the market.
“Energy prices are also being helped by news of the storm in the Gulf of Mexico,” he said. Oil rose sharply after Tropical Storm Ida forced the shut in of 30 percent of oil production in the Gulf of Mexico, cutting supplies to the world’s largest energy consumer.
Oil was up more than 2 percent to above $79 a barrel and gold prices rose to a record high above $1,110 an ounce.
The S&P/TSX composite index closed 236.46 points, or 2.1 percent, higher at 11,486.88, with nine of its 10 main groups up. Earlier in the day, the index touched 11,488.27, its highest level since October 26. It was the index’s fifth straight session of gains.
The blue chip S&P/TSX 60 index closed 15.08 points higher, or 2.26 percent, at 682.39.
Reporting by Jennifer Kwan; editing by Peter Galloway