March 5, 2013 / 9:38 PM / 6 years ago

CANADA STOCKS-TSX jumps on Scotiabank results, U.S. data

* TSX rises 28.63 points, or 0.23 percent, at 12,736.04
    * Seven of 10 main sectors advance
    * U.S. data helps Canada index, pushed Dow to record high

    By John Tilak
    TORONTO, March 5 (Reuters) - Canada's main stock index rose
on Tuesday, helped by Bank of Nova Scotia's dividend
hike and surprise profit jump as well as U.S. economic data that
spurred broad gains.
    Investors also took comfort from China's announcement of
record government spending this year, which helped lift
commodity prices.
    Data showed that the vast U.S. services sector grew at its
fastest pace in a year in February. 
    "The ISM numbers are a bit of a surprise. That's giving more
credence to a supportive U.S. economy," said Youssef Zohny,
portfolio manager at Stenner Investment Partners, a unit of
Richardson GMP.
    The Toronto Stock Exchange's S&P/TSX composite index
 ended up 28.63 points, or 0.23 percent, at 12,736.04,
after falling in the previous two sessions. Seven of the ten
main sectors gained. 
    The bounce was even more pronounced in the United States,
Canada's largest trading partner by far, where the Dow index
 surged to close at a record high, breaking through levels
last seen in 2007. 
    Commodity investors took encouragement from China's vow on
Tuesday to deliver economic growth this year of 7.5 percent and
concentrate on boosting domestic consumption. The target is
unchanged from 2012.
    Along with China's spending plans, which were expected to
sustain the country's economic growth, the market was encouraged
 by signs that the world's top central banks are likely to stick
to their easy monetary policies. 
    "Central banks around the world have been fairly explicit in
their intentions to support economic growth," Zohny said.
    The confluence of positive factors added up to a clear
indication to buy for many investors.
    "There's a bit of a snap-back in the market. It's a reaction
to the downward pressure we've seen lately," said Michael
Sprung, president of Sprung Investment Management. "Investors
are trying to cautiously look for places to come back into the
    Scotiabank, Canada's third biggest lender, was one of the
biggest beneficiaries, adding 0.7 percent to close at C$61.32
after it said quarterly profit rose 13 percent, driven by
acquisitions at home and abroad. 
    Its results capped off a week of stronger-than-expected
quarterly reports from Canada's top banks, which in many cases
used lower loan-loss provisions, cost-cutting, and stronger
international revenue to offset slower growth in domestic
consumer lending. 
    "The banks have shown themselves to be in pretty good
financial shape from the capital point of view. They expressed
some confidence in that by increasing their dividends," Sprung
    Scotiabank raised its dividend by 5 percent, following
similar increases by most of the country's Big Six banks.
    Financials, the index's weightiest sector, were up 0.4
percent. In the sector, Toronto-Dominion Bank gained 0.5
percent to C$85.43, and Canadian Imperial Bank of Commerce
 rose 0.5 percent to C$83.36.
    Energy stocks gained 0.3 percent, led by Suncor Energy's
 0.8 percent gain to C$30.85, while the materials sector,
which includes mining stocks and has been the worst performing
part of the index so far this year, added 0.4 percent.
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