TORONTO (Reuters) - Canada’s main stock index rallied broadly on Monday, bolstered by investor optimism over Greece’s latest attempt to avoid defaulting on its debts, a development that cast shade on the price of safe-haven gold and hurt its miners.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE gained 137.36 points, or 0.94 percent, to end at 14,790.48. All 10 main sectors closed higher, although the materials group that includes miners barely rose.
Euro zone finance ministers cautiously welcomed new Greek reform proposals as a possible basis for agreement, assuaging worries Greece may be forced out of the euro currency or the European Union.
But the Canadian stock market index has been moving steadily lower since a mid-April peak around 15,500, and the surge was not seen interrupting the broader trend.
“It’s a bounce and that’s all it is,” said Elvis Picardo, strategist at Global Securities in Vancouver, who said the TSX will likely move between 14,500 and 15,250 while awaiting corporate earnings that are still weeks away.
“Once the Greece situation gets resolved, favorably or unfavorably, you’re going to have a bit of a news vacuum, and it’s really difficult to see the TSX make sustainable headway,” he said.
The most influential movers on the index included Valeant Pharmaceuticals VRX.TO, which rose 2.2 percent to C$287.05, and pipeline operator Enbridge Inc (ENB.TO), which gained 2.6 percent to C$58.78.
On the other side of the ledger, gold miners featured heavily as the precious metal XAU= fell more than 1 percent over Greece, which curbed safe-haven demand. Barrick Gold Corp’s (ABX.TO) shares fell 2.3 percent to C$13.76. [GOL/]
“Going into June, markets really didn’t believe Greece might default and leave the European Union, but over the last 10 days it had become a very realistic probability,” said Julie Brough, vice president at Morgan Meighen & Associates.
“Now, with a new proposal ... You’re getting a tentative rally off of that, though clearly not recovering everything that we’ve lost over it.”
The financials group, which Brough noted was among the interest-sensitive sectors seeing a rebound, climbed 0.8 percent.
The smaller info tech group jumped 2.2 percent and telecoms were up almost 2 percent.
South of the border, Wall Street also rallied, with the Nasdaq Composite index .IXIC hitting a fresh record high. [.N]
Additional reporting by Solarina Ho; Editing by Grant McCool and James Dalgleish