TORONTO (Reuters) - Canada’s main stock index rose on Monday, reversing some of the previous week’s losses, as shares of natural resource companies were buoyed by advances in the prices of commodities such as gold, copper and oil.
Commodity prices benefited from worries about the situation in eastern Ukraine, where pro-Moscow rebel leaders called for their region to become part of Russia, the day after staging a referendum on self-rule. Moscow, however, stopped short of endorsing their bid for annexation.
The Toronto market’s advance came on the heels of a 1.6 percent drop in the previous week caused by concerns over Ukraine and a selloff in energy stocks.
The energy sector jumped 1.3 percent on Monday and had the biggest positive influence on the market. The group, one of the strongest performers this year, is up more than 14 percent so far in 2014.
“We’re seeing a new interest in oil and gas,” said Michael Simpson, senior portfolio manager at Sentry Investments.
Higher oil prices and the prospects of a possible rise in natural gas prices were supporting energy shares, he added.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed up 120.88 points, or 0.83 percent, at 14,654.94. It has added about 7.6 percent this year.
While stocks are not as cheap as they were a while ago, investors recognize that equities are “a much better alternative to investing in bonds,” Simpson said. But he added that “some investors want to limit their exposure to Canada because they are seeing a stronger U.S. economy.”
All of the 10 main sectors on the index were higher on Monday.
The materials sector, which includes mining stocks, was up 1.5 percent. Teck Resources Ltd TCKb.TO added 4.1 percent to C$25.39, and First Quantum Minerals Ltd (FM.TO) advanced 4.9 percent to C$22.04.
The price of bullion rose 0.7 percent, while copper jumped 2 percent.
In corporate news, U.S. drugmaker Allergan Inc (AGN.N) rejected Valeant Pharmaceuticals International Inc’s VRX.TO unsolicited takeover offer, saying it substantially undervalued the company. Valeant shares gave back 0.7 percent to C$141.98.
Editing by Nick Zieminski and Andre Grenon