November 19, 2012 / 6:53 PM / 6 years ago

CANADA STOCKS-TSX jumps on U.S. budget hopes

* TSX rises 128.08 points, or 1.08 percent, at 12,005.80
    * Materials, energy lead market rally
    * Suncor Energy up nearly 4 percent
    * All 10 main subgroups rise

    By John Tilak
    TORONTO, Nov 19 (Reuters) - Canada's main stock index jumped
more than 1 percent on Monday, led by material and energy stocks
as commodity prices rallied on hopes that a U.S. budget crisis
will be averted.
    On Sunday, Democrats and Republicans said they could reach a
deal to avert the "fiscal cliff," a mix of tax increases and
spending cuts starting early in the new year unless there is a
deal on Capitol Hill. 
    "If the market senses some agreement will be crafted, it
will move," said Irwin Michael, portfolio manager at ABC Funds.
    "The market was oversold," he said. "If we get any bit of
good news, that will be reflected in the stocks."
    At 1:44 p.m. (1744 GMT), the Toronto Stock Exchange's
S&P/TSX composite index was up 128.08 points, or 1.08
percent, at 12,005.80. All the 10 main sectors on the index were
    Energy stocks rose 1.67 percent, tracking higher oil prices.
Suncor Energy Inc was up 3.65 percent at 32.69 and
played the biggest role of any single stock in leading the
market higher.
    "As the energy sector goes, so does the TSX," said Sid
Mokhtari, market technician and director of institutional equity
research at CIBC World Markets. He noted that the energy sector
had fallen significantly since hitting highs in September. 
    Oil prices rose more than 2 percent as rising violence in
the Middle East raised concerns over oil supplies.        
    Goldcorp Inc was up 2.64 percent at C$40.77, and
Barrick Gold Corp gained 1.33 percent to C$34.22. That
helped the materials group, which includes mining stocks, rise
1.87 percent. Gold prices rose 1 percent as the dollar weakened
against a basket of currencies. 
    "There is a disconnect between the common shares of gold and
oil and gas companies, compared to the commodities of gold and
oil and gas. The market is very much undervalued," Michael said.
    Shares of Agrium Inc rose 1.84 to C$99.61 after its
largest shareholder, Jana Partners, launched a proxy battle and
named a slate of nominees to the board of the fertilizer maker.
    The financial sector, the biggest on the index, was up 0.82
percent. Royal Bank of Canada was up 1.60 percent at
C$56.51, and Bank of Nova Scotia climbed 0.74 percent
to C$53.40.
    In other company news, shares of Astral Media Inc 
were up 3.15 percent after BCE Inc, Canada's biggest
telecom provider, said it would seek regulatory approval for a
revised C$3 billion plan to take over the company.
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