September 14, 2012 / 3:53 PM / 7 years ago

CANADA STOCKS-TSX sustains rally, boosted by Fed measures

* TSX up 159.39 points, or 1.29 percent, at 12,519.55
    * Energy up 2.38 percent, materials up 2.93 percent
    * Seven of 10 sectors higher

    By Solarina Ho
    TORONTO, Sept 14 (Reuters) - Canada's main stock index rose
more than 1 percent on Friday in a broad, resource-led rally on
higher commodity prices following a long-awaited stimulus
program launched by the U.S. Federal Reserve.
    The TSX extended Thursday's 1 percent rally, with traders
inspired by the Fed's promise to pump $40 billion into the U.S.
economy every month until the country's weak labor market turns
around and as long as inflation remains contained.
    Resource stocks were buoyed by investors returning to
riskier assets. Stronger commodity prices translated to a 2.38
percent gain in energy stocks and a 2.93 percent rise in
    Suncor Energy was the most influential gainer on the
index, rising 3.86 percent to C$34.46. Canadian Natural
Resources was up 3.11 percent at C$33.84, while Teck
Resources rose 6.27 percent to C$33.41.    
    U.S. crude prices were set to finish the week up 3 percent
on hopes of stronger global demand for oil following the Fed's
aggressive move. 
    Copper prices jumped to 4-1/2-month highs as investors hoped
the stimulus would boost demand for industrial metals, while 
gold prices touched a six-month high.  
    "The markets responded well yesterday and they're still
responding well today," said Pat McHugh, Canadian equity
strategist at Manulife Asset Management.
    At 11:27 a.m. (1527 GMT), the Toronto Stock Exchange's
S&P/TSX composite index climbed 159.39 points, or 1.29
percent, to 12,519.55. Seven of the 10 main sectors were higher.
    Earlier in the session, the index hit a peak at 12,529.77,
the highest since March 27, when it touched 12,603.71.
    Financial stocks, which make up nearly a third of the
index's weight, were up 0.92 percent, led by Manulife Financial
, which was 5.11 percent higher, at C$12.76.
    Health care, telecom and consumer staple stocks were in
negative territory, down 0.48 percent, 1.42 percent, and 0.38
percent, respectively. 
    BCE Inc shares were off 2.70 percent at C$42.19,
while Valeant Pharmaceuticals International slipped
2.20 percent to C$55.59.
    "The traditionally defensive sectors, those were the ones
that had been doing well prior to the announcement ... people
are basically selling, taking profits in the few sectors that
have made money," said McHugh.
    "People have been feeling that there has been a sea change.
Whether that is in fact true remains to be seen ... from this
point forward, for the market to go up we're going to need
something on the earning side."
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