TSX rides energy and banks to higher close

Mon Dec 14, 2009 4:41pm EST
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article
[-] Text [+]

By Frank Pingue

TORONTO (Reuters) - Toronto's main stock index rose to a one-week high on Monday as a takeover by Exxon Mobil raised optimism about energy sector acquisitions, while an Abu Dhabi aid package for Dubai helped spark financials.

Suncor Energy, which headlined the overall rally, rose 2.2 percent to C$37.09, while EnCana Corp shares followed with a gain of 5.1 percent to C$31.55.

The rally in energy shares came after news that Exxon will buy XTO Energy Inc for about $30 billion in stock, a move that thrusts the U.S. energy giant to the forefront of North America's natural gas industry.

"If you look at one sector where it really looks like there might be lots of merger and acquisition possibilities it would have to be the energy sector," said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.

Heavily-weighted Canadian banks followed a rally in global equities overnight which was set off by the news that Abu Dhabi threw its debt-laden neighbor Dubai a $10 billion lifeline.

"That's taken some of the risk concerns off the table and so we're seeing pretty much a rally in financial stocks both here and around the world," said Picardo.

Shares of Bank of Nova Scotia rallied 1.3 percent to C$48.13, while Royal Bank of Canada ended up 0.7 percent at C$55.70.

The S&P/TSX composite index closed up 121.76 points, or 1.07 percent, at 11,545.69, reclaiming all of the 0.75 percent skid suffered last week.

The close was just four points off the TSX's session high, which had marked its highest level since December 7.

(Editing by Jeffrey Hodgson)

<p>People walk by a sign displaying TSX information in Toronto September 19, 2008. REUTERS/Mark Blinch</p>