September 24, 2013 / 12:40 PM / 5 years ago

Banks, industrials boost TSX as focus stays on Fed

TORONTO (Reuters) - Canada’s main stock index climbed on Tuesday as gains in the financial and industrial sectors drove the market, with investors remaining fixated on the direction of U.S. Federal Reserve policy.

A sign shows TSX information in Toronto September 15, 2008. REUTERS/Mark Blinch

With focus firmly on conjecture about what the Fed may have in mind for its stimulus program, the market combed economic data for hints on the U.S. central bank’s next move.

Among the data, a private sector report said U.S. consumer confidence slipped in September as consumers’ outlook on the future darkened a little, while U.S. home prices slowed their rate of gains in July.

But German business morale improved slightly to its highest level in 17 months in September, suggesting Europe’s largest economy is staging a firm recovery.

The financial sector had the biggest positive influence on the index. The group is up 11 percent this year, compared with the benchmark index’s 3 percent gain.

“Banks are leading the charge,” said Allan Small, senior investment advisor at Dundee Wealth, adding the banking sector is “a very good growth and income play”.

“A lot of people are flocking to it,” he added. “If the banks continue to do what they are doing, they make up enough of our market to power the TSX.”

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed up 37.71 points, or 0.29 percent, at 12,848.89.

Nine of the 10 main sectors on the index were higher.

Financials, the index’s most heavily weighted sector, rose 0.4 percent. In the group, Toronto-Dominion Bank (TD.TO) gained 0.7 percent to C$92.03 and played the biggest role of any single stock in leading the index higher. Royal Bank of Canada (RY.TO) added 0.4 percent to C$66.55.

The industrials group climbed 0.6 percent. In it, Canadian Pacific Railway Ltd (CP.TO) was up 0.8 percent at C$130.21, and Bombardier Inc (BBDb.TO) advanced 1.3 percent to C$4.87.

Shares of BlackBerry (BB.TO) dropped 3.3 percent to C$8.78, a day after the smartphone maker signed a tentative $4.7 billion deal to be acquired by a consortium led by its biggest shareholder, Fairfax Financial Holdings Ltd (FFH.TO).

Fairfax shares were little changed.

($1=$1.03 Canadian)

Editing by Peter Galloway

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