June 2, 2008 / 1:09 PM / 11 years ago

Stocks lifted by climbing resources

TORONTO (Reuters) - The Toronto Stock Exchange’s main index finished higher after a choppy session on Monday, lifted by gains in energy and other resource issues as commodity prices firmed.

A Toronto Stock Exchange (TSX) logo is seen in Toronto in this November 9, 2007 file photo. REUTERS/Mark Blinch

The advances in heavyweight resource shares overshadowed resurgent concern over the global impact of the credit crunch, a worry that hurt U.S. and European stock markets.

Toronto’s energy sector gained 1.8 percent as crude prices rose to $127.76 a barrel. Imperial Oil (IMO.TO) was up C$1.85, or 3.2 percent, at C$59.60, and Petro-Canada PCA.TO rose C$1.08, or 1.9 percent, to C$58.41.

Gains by miners, as bullion prices pushed higher, and agricultural companies helped the materials group rise 1.4 percent. Goldcorp (G.TO) rose 76 Canadian cents, or 1.9 percent, to C$40.73, while fertilizer company Potash Corp of Saskatchewan POT.TO added C$6.04, or 3.1 percent, to


Energy and materials shares “are still in the running and they’re propelling our gains in Canada,” said Adrian Mastracci, portfolio manager and president at KCM Wealth Management Inc. in Vancouver. “Our commodities-style indices are sort of masking what’s really going on in other parts of the world.”

The S&P/TSX composite index .GSPTSE closed up 99.45 points, or 0.68 percent, at 14,814.18, with seven of its 10 main sectors on the upside.

Shares of Centerra Gold (CG.TO) were off 55 Canadian cents, or 6.2 percent, at C$8.30 after the miner said a framework agreement with the government of Kyrgyzstan had expired when a ratification deadline was missed. That highlighted concerns over the ownership of the Canadian company’s Kumtor mine.

Shares of WestJet Airlines (WJA.TO) gave up 65 Canadian cents, or 4.1 percent, to C$15.05 after a brokerage lowered its target for WestJet’s share price. The brokerage cited rising fuel costs and a possible reduction in travel as consumers reject surcharges.

The large financial sector was down 0.3 percent as Toronto-Dominion Bank (TD.TO) slid 94 Canadian cents, or 1.3 percent, to C$70.95, and Bank of Montreal (BMO.TO) dipped 27 Canadian cents, or 0.6 percent, to C$48.50.

South of the border, financial stocks were slammed by concerns of more fallout from the credit squeeze as Standard & Poor’s cut debt ratings of three major securities companies.

In addition, Wachovia Corp WB.N ousted its chief executive, raising concern that more bad news may lie ahead for the fourth-largest U.S. bank. In Europe, British lender Bradford & Bingley BB.L said the UK mortgage market was deteriorating.

The Toronto benchmark has risen in recent months, reaching a record high over 15,000 in May, on optimism that the worst of the problems in the financial markets has passed.

“I think one of the problems is that people continually feel that because of the market rally, the credit problem is over with and it’s really not,” said Paul Harris, portfolio manager at Avenue Investment Management.

“It’s an ongoing process which will take several months for it to finally peter out.”

Elsewhere, shares of yoga wear retailer Lululemon Athletica LLL.TO closed up 56 Canadian cents, or 1.8 percent, at C$32.64 as investors awaited quarterly results after the bell. In the event, Lululemon reported its first-quarter profit more than doubled, but it lowered its forecast slightly for the rest of the year.

Market volume was 404 million shares worth C$7.2 billion. Decliners outpaced advancers 817 to 771. The blue chip S&P/TSX 60 index .TSE60 closed up 5.40 points, or 0.61 percent, at 883.82.

In New York, stocks were taken lower by resurgent fears of losses related to the credit crunch. The Dow Jones industrial average .DJI closed down 134.50 points, or 1.06 percent, at 12,503.82, and the Nasdaq Composite Index .IXIC fell 31.13 points, or 1.23 percent, to 2,491.53.

($1=$1.00 Canadian)

Editing by Frank McGurty

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