December 27, 2013 / 9:40 PM / 7 years ago

CANADA STOCKS-TSX makes broad gains, closes above 30-month high

By Allison Martell
    TORONTO, Dec 27 (Reuters) - Canada's main stock index rose
in light trading on Friday, led by energy, materials and
financial stocks, extending a two-week rally fed by growing
optimism about global economic growth.
    The resource-heavy index was helped by higher commodity
prices, said Paul Harris, portfolio manager at Avenue Investment
Management in Toronto.
    Gold edged higher, copper touched a four-month peak and U.S.
crude oil futures rose after government data showed that U.S.
oil inventories had fallen for the fourth straight week. 
    "Oil is driven by economic growth, effectively, so we think
that oil going up makes a lot of sense in a world that looks
like it's going to be growing a lot faster," said Harris.
    Copper prices hit their highest point in more than four
months, boosted by tightening supply and optimism about the
    The Toronto Stock Exchange's S&P/TSX composite index
 ended up 69.96 points, or 0.52 percent, at 13,587.98,
its highest close since May 2011.
    The exchange was closed for the Boxing Day holiday on
Thursday, when U.S. equity markets, where many Canadian
companies also trade, pushed higher. 
    Paul Hand, managing director of RBC Capital Markets, said
Canadian stocks were catching up to their U.S. counterparts,
though many traders were still on vacation.
    "The market has been basically in rally mode - there's been
very little news over the holiday period," he said. "The glass
has been half full for a lot of people in the last few months."
    The U.S. Federal Reserve's assurance last week that it would
keep its key interest rate at rock bottom longer than previously
promised - even as it trimmed asset purchases - kicked off a
global rally in stocks. 
    The news resolved uncertainty that had been hanging over the
markets, and investors were cheered by the fact that greater
confidence in the economic recovery had spurred the Fed.
    On Friday, materials stocks gained 1.3 percent, energy
stocks rose 0.6 percent, and financial shares were up 0.4
    Potash Corp was the most influential gainer, rising
2.1 percent to C$35.36. Toronto-Dominion Bank also
pushed the index higher, rising 0.7 percent to C$99.67. Canadian
Natural Resources Ltd rose 1.4 percent to C$35.72.
    In company news, Bega Cheese Ltd, the largest
shareholder in Saputo Inc's latest takeover target,
Warrnambool Cheese and Butter Factory Co Holdings Co,
said it is in talks with "non-Australian" investors on a
possible sale of its stake.
    In September Bega kicked off a takeover battle with dairy
giant Saputo and another Australian cheese maker, but the
company declined to extend its final offer last week. Saputo
rose 0.5 percent to C$48.64 in early trading.
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