August 16, 2012 / 8:38 PM / 6 years ago

CANADA STOCKS-Barrick, miners push TSX to 3-month high

* TSX adds 1.1 pct, or 127.14 points, to close at 12,032.58
    * Gains led by mining, energy shares
    * Barrick up 3.9 pct after says in talks to sell Africa unit
    * Merkel comments, China data boost stimulus hopes

    By Jon Cook
    TORONTO, Aug 16 (Reuters) - Canada's main stock index rose
above the 12,000 level for the first time since early May on
Thursday as mining shares rallied on fresh stimulus hopes and
after Barrick Gold said it is in talks to sell a
majority stake in its African unit.
    The push above the psychological 12,000 barrier was
significant, investors said.
    "It's crucial for two reasons," said Elvis Picardo,
strategist and vice president of research at Global Securities
in Vancouver. "It has been a resistance level in the past and it
also coincides with the index's 200-day moving average."
    "The fact that it's broken through 12,000 is promising, but
we need to see if it's sustainable," he added.
    Barrick was among the index's top gainers, climbing 3.9
percent to C$35.60, after the world's largest gold miner
confirmed it is in talks to sell a majority stake in its African
unit to China National Gold Group. 
    Adding to the gold group's luster, prices for bullion
rebounded from two straight losing sessions after prominent
hedge fund managers, including John Paulson and George Soros,
raised their stakes in the No. 1 gold exchange-traded fund, SPDR
Gold Trust, in the second quarter. 
    Other top mining stocks that gained included Goldcorp Inc
, up 4.7 percent at C$37.93, and Potash Corp,
which rose 1.6 percent to C$43.99.
    "We've had a lot of bad news over the last few months and
the market has not fallen apart," said Irwin Michael, portfolio
manager at ABC Funds. "The bottom line is the market is feeling
    The Toronto Stock Exchange's S&P/TSX composite index
 added 1.1 percent, or 127.14 points, to close at
12,032.58, its highest level since May 3. 
    The heavily weighted materials sector, which includes
miners, led the way, jumping 3 percent.
    Commodities were also buoyed by remarks from German
Chancellor Angela Merkel that were viewed as supportive of
further stimulus moves from the European Central Bank. On a
visit with Canadian Prime Minister Stephen Harper on Thursday,
Merkel voiced support for ECB President Mario Draghi's
crisis-fighting strategy. 
    "What happens in Europe will affect us in North America,"
said Michael. "The powers that be at various central banks have
to realize that no man is an island and we're going to have to
fix the problems at whatever cost it may be."
    Canada's energy subindex rose 1.2 percent, led by Canadian
Natural Resources, which gained 2.4 percent to C$31.55.
    Investors were also focused on expectations for economic
stimulus in China after Premier Wen Jiabao said on Wednesday
that the country, the world's top consumer of refined copper,
still faced headwinds despite cooling inflation. 
    Those expectations got another boost after China's Commerce
Ministry said that the trade outlook for 2012 was
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