TORONTO (Reuters) - Canada’s main stock index moved within reach of its all-time high on Tuesday as base metal and oil prices rose and U.S. President Donald Trump smoothed the path for TransCanada Corp’s (TRP.TO) Keystone XL pipeline.
TransCanada jumped 2.7 percent to C$64.24 after Trump signed two executive orders to move forward with construction of the controversial Keystone XL and Dakota Access oil pipelines, rolling back key Obama administration environmental actions in favor of expanding energy infrastructure.
“Having access to different entry points into the U.S. is good and positive (for the energy sector). It reinforces the economic and energy integration between Canada and the United States,” said Michael Simpson, senior portfolio manager at Sentry Select Capital Corp.
The energy group, which had hit a nearly two-month low on Monday amid investor worries about a U.S. border adjustment tax, rallied 2.3 percent.
Investors have taken greater heed of Trump’s recent comment that a border adjustment provision is too complicated, Simpson said.
Suncor Energy Inc (SU.TO), Canada’s largest oil and gas producer, rose 2.4 percent to C$42.45 as higher oil prices also helped boost sentiment.
U.S. crude oil futures CLc1 settled 43 cents higher at $53.18 a barrel ahead of weekly U.S. inventory data on evidence the global market is tightening as lower production by OPEC and other exporters drains stocks. [O/R]
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed up 130.56 points, or 0.84 percent, at 15,610.69, its highest close since September 2014.
The materials group, which includes precious and base metals miners and fertilizer companies, added 1.3 percent as copper prices CMCU3 rose more than 2 percent and other base metals also gained.
All of the index’s 10 main groups ended higher, with the heavyweight financials group gaining 0.2 percent and consumer discretionary stocks climbing 0.7 percent.
A planned EU-Canada free-trade deal, seen as a counterweight to anticipated U.S. protectionism under Trump, moved closer to reality after a key committee advised the European Parliament to give its backing after months of protests and heated debate.
Additional reporting by Alastair Sharp; Editing by Cynthia Osterman