March 8, 2012 / 1:42 PM / in 6 years

Greece hopes lift TSX to biggest gain in 2 weeks

TORONTO (Reuters) - Toronto’s main stock index closed sharply higher on Thursday, posting its biggest gain in more than two weeks as financial and resource issues climbed on signs that Greece would finalize a private debt swap and avoid a chaotic default.

A Bay Street sign is seen at the financial district in Toronto, October 10, 2008. REUTERS/Mark Blinch

Greece pushed through a bond swap offer to private creditors after clearing the minimum 75 percent threshold of acceptance, moving closer to securing the 130 billion euro bailout fund it needs to avert a default.

“It looks like they’re going to get enough people to accept with gritted teeth the haircut that they’re forcing on them,” said Gavin Graham, president at Graham Investment Strategy.

Expectations of a solid U.S. employment report for February on Friday also fueled appetite for oil and other growth-sensitive commodities, spurring rises in economically sensitive sectors on the Toronto index. The energy group was up 1 percent and financials were up 1.2 percent.

“Evidently the risk-on trade is back on again,” Graham said.

He noted that a more hawkish-sounding statement from Bank of Canada on Thursday may have also helped give resource and bank shares a bump.

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended up 111.77 points, or 0.91 percent, at 12,461.93. Eight of its 10 main groups were higher.

The biggest heavyweight gainers were Royal Bank of Canada (RY.TO), up 2 percent at C$56.93, Toronto-Dominion Bank (TD.TO), up 1.7 percent at C$81.70, and Cenovus Energy (CVE.TO), which jumped 3.4 percent to C$37.89.

Air Canada ACa.TO shares were up 2.2 percent at 94 Canadian cents as the federal government blocked labor disruptions at the country’s largest airline.

Canadian Imperial Bank of Commerce (CM.TO) slipped 0.2 percent to C$76.11, despite earnings that beat analysts’ estimates. CIBC also said it plans to sell its FirstLine discount mortgage unit in an effort to earn higher margins from its loans.

Canadian Natural Resources (CNQ.TO) advanced 0.6 percent to C$35.35 after announcing it expects the bargain-basement prices it now garners for its oil to improve over the next few months.

Sun Life Financial (SLF.TO) rose 0.9 percent to C$20.86 after it announced plans to boost its operating income to C$2 billion in the next three years by focusing on high growth businesses and riding an expected improvement in stock and bond markets.

($1=$0.99 Canadian)

Reporting by Claire Sibonney Editing by Peter Galloway

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