TORONTO (Reuters) - Canada’s main stock index climbed on Tuesday to its strongest level in almost six years as robust results from Suncor Energy Inc SU.TO boosted shares of the oil producer and higher oil prices lifted other energy stocks.
Suncor’s stock hit its highest since 2011 after the company reported late on Monday a 36 percent rise in first-quarter profit on strong oil prices and a lower Canadian dollar.
A jump in shares of Encana Corp ECA.TO after the natural gas producer announced an asset sale further supported the market.
Investors also awaited the outcome of a two-day policymaking meeting of the U.S. Federal Reserve to look for clues on the direction of its monetary policy. The central bank is expected to continue paring its bond buying and possibly provide guidance on when it may raise interest rates.
The Canadian benchmark is up about 7 percent this year and has outperformed the S&P 500 .SPX so far in 2014.
“The index has come a long way. It is making up for lost ground after three years of underperformance,” said Elvis Picardo, strategist and vice president of research at Global Securities in Vancouver.
“The fact that this rally is being driven by earnings is a good thing,” he added. “But I wouldn’t be surprised to see some signs of sideways action from here on.”
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed up 52.20 points, or 0.36 percent, at 14,583.11. Five of the 10 main sectors on the index were higher.
Shares of energy producers are up about 17 percent since the start of the year, helping push up the broader market. The sector climbed 1.6 percent on Tuesday, reflecting gains in the price of oil. <O/R>
Suncor Energy Inc SU.TO jumped 3.1 percent to C$42.60 and had the biggest positive influence on the market.
“It proves that the optimism surrounding the energy group has been justified,” Picardo said of Suncor’s results. “It’s yet another positive day for the group.”
Other gainers included Enbridge Inc ENB.TO, which added 0.5 percent to C$52.77.
Encana advanced 2.5 percent to C$25.68 after saying it had agreed to sell about 90,000 net acres in east Texas for about $530 million to an undisclosed buyer.
In other corporate news, Cameco Corp CCO.TO gave back 3.6 percent, to C$23.27, after the uranium producer reported quarterly results that missed market expectations.
Editing by Bernadette Baum and Meredith Mazzilli