TSX bounces from Brexit slide, scoring largest gain in seven weeks

TORONTO (Reuters) - Canada’s main stock index scored its largest gain in seven weeks on Tuesday, paring some of the losses inflicted in the prior two sessions after Britain’s shock vote to leave the European Union as oil rallied and investors sought out bargains.

A man walks past an old Toronto Stock Exchange (TSX) sign in Toronto, June 23, 2014. REUTERS/Mark Blinch

Banks and energy companies, both of which had fallen heavily after Thursday’s vote, led the rebound. The financials group rose 1.4 percent, while energy stocks climbed 2.4 percent as oil rallied.

Greater confidence that Brexit-related issues will be dealt with has encouraged investors to look for bargains, said Brian Pow, vice president, research at Acumen Capital Partners.

“Equities ultimately are still in favor just given the low interest rate environment,” he added.

Toronto-Dominion Bank TD.TO rose 1.5 percent to C$55.32 and Royal Bank of Canada RY.TO advanced 1.6 percent to C$76.38.

“Our banks always demonstrate that they got real resilience ... trying to paint a more negative story around Brexit won’t stand too long,” Pow said.

Suncor Energy Inc SU.TO rose 1.8 percent to C$34.94, while U.S. crude oil futures CLc1 settled $1.52 higher at $47.85 a barrel.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE closed up 152.9 points, or 1.12 percent, at 13,842.69.

Nine of the index’s 10 main groups ended higher.

Plane maker Bombardier Inc BBDb.TO gained nearly 5 percent to $1.90 after Air Canada said it had finalized a deal to buy 45 of its CSeries jets with an option to purchase another 30.

Industrials rose 1.6 percent.

Shares in Canexus Corp CUS.TO were unchanged at C$1.30. The chemical company said Canada's antitrust regulator had approved its proposed buyout by rival Superior Plus Corp SPB.TO.

That approval came a day after U.S. antitrust regulators filed a complaint to block the deal, saying the companies were two of the three manufacturers of a chemical needed to whiten wood pulp for paper production.

Shares in Superior advanced 1 percent to $10.29.

Gold miners, which had helped limit the TSX's overall losses with strong gains on Friday and Monday, were a drag on the market. Barrick Gold Corp ABX.TO fell 2.6 percent to C$26.87 and Goldcorp Inc G.TO slipped 0.5 percent to C$23.92.

The materials group, which includes precious and base metals miners and fertilizer companies, lost 0.6 percent, while spot gold XAU= fell 1 percent.

Additional reporting by Alastair Sharp; Editing by Nick Zieminski and Sandra Maler