February 1, 2012 / 1:43 PM / 6 years ago

TSX rises on stronger global factory data

TORONTO (Reuters) - The TSX index rose broadly on Wednesday as sentiment got a lift from encouraging manufacturing data from three of the world’s biggest economies, which eased fears about slow global growth.

<p>People walk by a Bay Street sign inside the financial district in Toronto October 10, 2008. REUTERS/Mark Blinch</p>

The index’s financial sector led the way with a 1.1 percent gain as data showed factory activity rose in China, the United States and Germany in January.

Royal Bank of Canada (RY.TO) was up 1.7 percent at C$53.28, and Toronto-Dominion Bank (TD.TO) climbed 0.5 percent to C$77.96. Bank of Nova Scotia (BNS.TO) rose 0.6 percent to C$51.84.

The Chinese figures were especially encouraging, said Philip Petursson, managing director of the portfolio advisory group at Manulfie Asset Management.

“What we’ve got is some positive economic data out of China showing perhaps some reaccelerating of their economy, which is putting risks to the upside - meaning things are looking better than what people perhaps thought even a couple weeks ago,” he said.

“China has done a pretty good job at engineering a soft landing.”

Corporate earnings have also been flowing in at a “healthy pace,” Petursson said.

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE finished the day up 65.51 points, or 0.53 percent, at 12,517.66, with nine of its 10 main sectors higher. The consumer staples sector, down 1.3 percent, was the lone group in the red.

In January, the index rose 4.2 percent.

The Toronto index rose along with stock markets around the world and the euro with speculation that a Greek debt deal was close at hand also providing support.

The euro rose after Greece’s finance minister, Evangelos Venizelos, said talks with private creditors on a bond swap deal that is key to the country avoiding an unruly default were “one formal step away”.

“For all the talk that we have had about Europe over the last days and weeks, today’s talk really doesn’t center a whole lot on Europe,” said Fred Ketchen, director of equity trading at ScotiaMcLeod.

“But Greece is still there. Greece is still in the glue,” he added, noting the outcome of the debt talks could significantly influence market mood.

The TSX index’s key energy sector edged up 0.1 percent as the price of oil rose on the Chinese figures and as the standoff between Iran and the West outweighed data that showed a large buildup in U.S. oil inventories. <O/R>

Oil company Canadian Natural Resources (CNQ.TO) was up 1.1 percent at C$40.16.

Materials shares closed 0.3 percent higher as gold and some other metals pricesclimbed as the U.S. dollar slipped against the euro <GOL/>. First Quantum (FM.TO) rose 2.8 percent to C$22.58.

The blue chip S&P/TSX 60 index .TSE60 closed 3.39 points higher, or 0.48 percent, at 712.57.

Reporting By Jennifer Kwan; Editing by Peter Galloway

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