TORONTO (Reuters) - Canada’s main stock index rose on Wednesday as higher oil prices supported energy stocks, while financial and materials stocks also advanced after the Federal Reserve kept interest rates unchanged.
The Toronto Stock Exchange (TSX) has rallied 20 percent since January, helped by a rebound in U.S. crude oil from a 12-year low.
Investor sentiment improves when oil is trading above $40 a barrel, said Barry Schwartz, portfolio manager at Baskin Financial Services, while a rallying Canadian dollar has signaled strength in the domestic economy, adding to support for the index.
The loonie reached a new nine-month high at C$1.2571, although ended only slightly higher after the Fed left the door open to a June rate hike.
Schwartz expects the index to “blow past” the 14,000 threshold that has capped the rally since January if the higher oil and Canadian dollar trend continues.
The TSX’s S&P/TSX composite index closed up 78.22 points, or 0.57 percent, at 13,887.66. Seven of the index’s 10 main groups ended higher.
Cenovus Energy Inc reported a wider-than-expected quarterly operating loss and said its cash flow slumped 95 percent, hurt by the prolonged slump in oil and natural gas prices.
Still its shares rose 1.6 percent to C$19.18, while the overall energy group advanced nearly 1 percent as oil reached its highest level of 2016.
U.S. crude settled up $1.29 at $45.33 a barrel. [O/R]
TransCanada Corp rose 1.5 percent to C$51.72, while Enbridge Inc was up 0.8 percent at C$52.90.
The materials group, which includes precious and base metals miners and fertilizer companies, added 1.3 percent. It was led by an 8 percent jump in the shares of First Quantum Minerals Ltd to C$9.32.
Financials rose 0.3 percent, while gains for railway stocks helped push the industrials group 1.1 percent higher.
Shares of Bombardier Inc rose 1 percent to C$2.01 after the company moved forward release of its first-quarter results by a day to Thursday in a surprise announcement that elevated market expectations of a big CSeries order this week.
Technology stocks fell 1.4 percent as worse-than-expected results from Apple and Twitter weighed on technology stocks globally.
DH Corp dropped 9.5 percent to C$33.70, while CGI Group Inc was down 1.4 percent at C$59.34.
The shares of Valeant Pharmaceuticals fell 3.5 percent to C$44.12. The company’s outgoing chief executive Michael Pearson plans to tell a U.S. Senate panel that he regrets having raised heart drug prices.
Reporting by Fergal Smith; Editing by James Dalgleish, Toni Reinhold
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