September 27, 2012 / 2:52 PM / 6 years ago

CANADA STOCKS-TSX breaks 5-day fall on China cash, Europe hopes

* TSX up 35.28 points, or 0.29 percent, at 12,268.76
    * China central bank injection helps sentiment
    * Investors bet that Spain will seek bailout

    By Alastair Sharp
    TORONTO, Sept 27 (Reuters) - Canada's main stock index rose
on Thursday morning, breaking a five-day fall, as investors
cheered moves by China to inject cash into money markets and bet
that Spain will ultimately seek a debt bailout that would
trigger euro zone stimulative action.
    The market's materials, energy and financial sectors - which
together account for three-quarters of the Toronto Stock
Exchange's S&P/TSX composite index - all notched
modest gains, helping the index move up 35.28 points, or 0.29
percent, to 12,268.76 by 10:30 a.m. (1430 GMT).
    "This injection by China is consequential," said Gareth
Watson, a vice president for investment management and research
at Richardson GMP, referring to a net 365 billion yuan ($58
billion) money-market injection by China's central bank aimed at
preventing a short-term liquidity crunch at the country's
commercial banks. 
    On Europe, Watson said that investors appeared to be looking
beyond street protests against austerity measures in Spain and
Greece and assuming that Madrid will eventually request an aid
package that would trigger European Central Bank bond-buying.
    "The market is looking ahead and finding it very difficult
to believe Spain will go ahead without asking for a bailout, so
we will react today as if it is already in place," Watson said.
    Illustrating the broad nature of the Toronto index's modest
rise, the three gainers with the most impact on Thursday morning
were a bank, an oil company and a gold miner.
    Bank of Nova Scotia rose 0.9 percent to C$54.54,
Suncor Energy moved 0.9 percent higher to C$32.31, and
Goldcorp gained 1 percent to C$44.76.
    Weighing on the index, Enbridge Inc dipped 1
percent to C$38.49 after environmental groups sued the
government over the pipeline company's contentious Northern
Gateway pipeline.
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