TORONTO (Reuters) - Canada’s main stock index rebounded from last week’s weakness and advanced on Monday as resource prices rose on concerns about instability in Ukraine, while data showed a rebound U.S. retail sales in March.
Five of the 10 main sectors on the Toronto stock market’s benchmark index were higher after the index fell to its lowest level in two weeks on Friday on worries about valuations in the U.S. technology sector.
“It’s certainly a bounceback after you had such sloppy markets, in particular the U.S. tech and biotech (groups),” said Paul Taylor, chief investment officer at BMO Asset Management.
“Today we’re getting a little bit better tone and the data has been supportive.”
U.S. retail sales recorded their largest gain in 1-1/2 years in March, data showed, signaling the U.S. economy is rebounding from a weather-induced slumber.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was up 26.74 points, or 0.19 percent, at 14,284.43.
Resource groups led the way as investors embraced safe haven investments as growing violence between pro-Russian separatists and Ukrainian government forces raised fears that the Ukraine crisis might be spiraling out of control.
Gold prices hit a three-week high, sparking the mining-heavy TSX materials index to a 1.0 percent gain.
Iamgold Corp (IMG.TO) jumped 3.4 percent to C$3.98, while Barrick Gold Corp (ABX.TO) advanced 0.9 percent to C$20.63. Leading the group was nickel miner Sherritt International (S.TO), which jumped 9.3 percent to C$4.70, helped by nickel prices that hit a 14-month high.
Energy shares rose 0.4 percent, with higher oil prices driving the gains. Paramount Resources POU.TO climbed 3.1 percent C$54.81, while Encana Corp (ECA.TO) rose 0.5 percent to C$24.78.
In corporate news, residents of the British Columbia town of Kitimat voted this weekend against the proposed Northern Gateway pipeline project in a blow to Enbridge Inc’s (ENB.TO) efforts to expedite the flow of crude from Canada’s oil sands to markets in Asia. Enbridge shares gave back 0.8 percent to C$50.76.
Global stock markets have been highly volatile in recent weeks over concerns about stretched valuations and the direction of the U.S. Federal Reserve’s monetary policy.
The Toronto stock market’s benchmark index, which lost about 1 percent last week, is up about 5 percent this year, and has outperformed the S&P 500 index .SPX so far in 2014.
“The overall sentiment is cautious,” said Irwin Michael, portfolio manager at ABC Funds. “But we think stocks are good value, and we believe that the various stock indices will end the year higher than where they are today.”
He said he expected the Canadian index to outpace the U.S. market as the country’s proportionally large resource sector strengthens.
Additional reporting by John Tilak; editing by Peter Galloway