TSX rises, energy leads broad rally as oil climbs

TORONTO (Reuters) - Canada’s main stock index rose on Friday, extending its rebound from a 5-month low set intraday the day before, with energy shares leading a broad-based rally ahead of the Victoria Day holiday long weekend as oil prices rose.

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

The Toronto Stock Exchange’s S&P/TSX composite index closed up 181.26 points, or 1.19 percent, at 15,458.46.

“The TSX is doing really nicely heading into the long weekend,” said Colin Cieszynski, senior market analyst at CMC Markets Canada.

Investor sentiment toward Canada became less negative after the index had been pressured earlier in the week by the prospect of a renegotiation of the North American Free Trade Agreement, Cieszynski added.

On Thursday, the Trump administration set the clock ticking toward a mid-August start of renegotiations of NAFTA and the TSX hit its lowest intraday level since Dec. 7 at 15,164.73.

For the week, the index fell 0.5 percent.

Canadian economic data showed the country’s annual inflation rate held steady in April, while March retail sales climbed more than expected, suggesting consumer spending was holding up.

The energy group jumped 2.5 percent, bolstered by higher oil prices, with Enbridge Inc gaining 1.4 percent to C$53.51.

U.S. crude prices settled up 98 cents at $50.33 a barrel, closing out a second week of gains on growing expectations that Organization of the Petroleum Exporting Countries and other producing countries will agree next week to extend output cuts. [O/R]

Some of the most influential movers on the index were banking issues, with Bank of Nova Scotia topping the list, rising 1.4 percent to C$75.48.

Home Capital Group Inc, which has been struggling to finance its assets after Canada’s biggest securities regulator accused the company of making misleading statements to investors, rose 3.7 percent to C$9.20 after it reported an increase in its savings deposit balances.

The overall financial services group, which accounts for about a third of the index’s weight, gained nearly 1 percent.

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

The materials group, which includes precious and base metals miners and fertilizer companies, added 1.3 percent.

Potash Corp advanced nearly 4 percent to C$22.48 as the fertilizer producer’s chief executive said a change in SQM’s governance that gave Potash greater influence did not reflect its intent to raise its stake in the Chilean lithium producer.

Canadian National Railway Co rose 1.3 percent to C$101.24, while the overall industrials sector rose 1.0 percent.

Additional reporting by Solarina Ho; Editing by Bernard Orr and Meredith Mazzilli