TORONTO (Reuters) - Canadian stocks notched their highest close in more than 10 weeks on Wednesday, tracking a broad rally in riskier assets on hopes that the International Monetary Fund would be able to raise more money to help resolve Europe’s debt crisis.
The IMF is seeking to boost its war chest by $600 billion to help countries reeling from the crisis, but some nations insist Europe must first do more to support ailing members, sources said.
Meanwhile, Greece and its creditors resumed negotiations on terms of a planned debt swap, hoping to overcome an impasse in talks and stave off a painful default.
Suncor Energy SU.TO led the gains, rising 2.2 percent to C$33.94, followed by Canadian Natural Resources CNQ.TO, up 2.7 percent to C$38.76 and Royal Bank of Canada RY.TO, which added 1.2 percent to C$52.45.
“There must be some sense that maybe it’s just the daily relief of the skirmishes in Europe. The market seems to be very reactively as to whether or not things are going positively there, particularly with respect to the financials,” said Michael Sprung, president of Sprung & Co Investment Counsel.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended up 94.69 points, or 0.77 percent, at 12,327.52. It was the TSX’s strongest close since November 8.
Bank of Nova Scotia BNS.TO was another big gainer, up 1.5 percent to 52.56, after announcing it will acquire 51 percent of Colombia’s Banco Colpatria COL.CN through a combination of $500 million in cash and 10 million common shares.
Despite far less exposure to risky European debt assets than their global counterparts, an easing of the euro zone’s debt crisis would still reflect positively on Canadian banks.
Analysts are looking closely at banks this week with the North American earnings season gathering momentum. On Wednesday, Goldman Sachs Group Inc reported quarterly profits that beat estimates.
“The financials are taking a bit of a page from the U.S.,” said John Kinsey, portfolio manager at Caldwell Securities. “This is a heavy week in the U.S., so to a certain extent they were waiting on that to see what was going to happen in the U.S. financial markets.”.
Among the heaviest laggards, TransCanada Corp TRP.TO fell 1.1 percent to C$41.89 after U.S. President Barack Obama decided to reject the company’s plan to build the Keystone XL Alberta-Texas crude oil pipeline.
“The market has been anticipating that this was a very very strong possibility, that any decision on the actual building would be postponed until after the election, so I think it was pretty much already in the market,” said Sprung.
Research In Motion RIM.TO shares eased 1.6 percent to C$17.47 after Samsung Electronics 005930.KS denied it was interested in buying the BlackBerry maker.
Finning International FTT.TO jumped 7 percent to C$26.10 on news it will pay $465 million to buy parts of a mining equipment distribution business from Caterpillar CAT.N, betting on strong global demand for metals, coal and oil.
Additional reporting by Jon Cook; editing by Rob Wilson