TORONTO (Reuters) - Toronto’s main stock index rallied on Tuesday as investors focused on encouraging U.S. corporate results, improving sentiment about Europe’s economy and recovering commodity prices.
Among the top gainers on the index, Suncor Energy (SU.TO) rose 2 percent to C$31.43, Canadian Natural Resources (CNQ.TO) climbed 2.3 percent to C$32.65 and Toronto-Dominion Bank (TD.TO) advanced 1 percent to C$83.56.
“In essence, we’ve switched from being worried about what could go wrong to focusing on what’s going right,” said Gavin Graham, president at Graham Investment Strategy.
Among the positive headlines on Tuesday, German analyst and investor confidence rose unexpectedly in April to a high not seen since June 2010, while easing Spanish bond yields boosted confidence before a long-term debt auction later in the week.
Investors also latched on to another round of strong earnings south of the border. Of the 39 S&P 500 companies that have reported earnings, 74.4 percent beat estimates, according to Thomson Reuters data. .N
In Canada, a more hawkish-sounding central bank surprised markets when it said it may need to start raising interest rates.
“The Bank of Canada sounded more optimistic about life in general... (investors) don’t bother to think through the implications of that, which is if the economy is stronger, then you’re going to end up with higher interest rates,” added Graham.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was ended up 99.35 points, or 0.83 percent, at 12,136.94. All 10 sectors were stronger.
“Gold stocks are discounting about a $1,000 gold price, and the oil stocks are discounting about an $80 oil price,” said John Kinsey, portfolio manager at Caldwell Securities.
“I‘m hoping when the first-quarter earnings come for these companies that they’ll be good, and that might help to close the gap somewhat.”
Editing by Dan Grebler