* TSX rallies 187.12 points to 10,477.24
* Financials rise on U.S. bank sector upgrade
* Energy shares chip in as oil prices jump (Adds details)
By Frank Pingue
TORONTO, June 4 (Reuters) - Toronto’s main stock index ended nearly 2 percent higher on Thursday as a rally in oil prices boosted the weighty energy group, while financials surged after an upgrade to the U.S. banking sector.
The energy group exited the session up 2.8 percent, a move credited largely to the surge in oil prices to a seven-month high on hopes for an economic recovery.
Shares of Suncor Energy (SU.TO), the biggest driver of the latest rally, rose 4.9 percent to C$37.50, while Petro-Canada PCA.TO shares ended up 4.8 percent at C$47.15.
On Thursday, shareholders of both companies voted overwhelmingly in favor of Suncor’s C$22.2 billion ($20.2 billion) takeover of Petro-Canada. [ID:nTOD004102]
Another key reason for the TSX’s rebound from Wednesday’s session was the turn higher in the financial index, which accounts for about 33 percent of the broader index.
Investors flocked to shares of Canadian banks after RBC Capital Markets upgraded the U.S. banking sector, saying the battered industry is in the early stages of a multiyear bull market. [ID:nBNG426422]
The S&P/TSX composite index .GSPTSE closed up 187.12 points, or 1.82 percent, at 10,477.24, reclaiming a chunk of the previous session’s 300-point loss.
“I think it’s a market here that has had a very nice run and it’s kind of stuck here,” said John Kinsey, portfolio manager at Caldwell Securities Ltd.
“It can’t seem to make up its mind; it’s what I would call a roller-coaster market, up one day and down the next.”
Another sector that rebounded was the materials group, home to major mining stocks, as gold futures reversed Wednesday’s drop after a bullish oil-price forecast by Goldman Sachs boosted inflation-hedging buying. [ID:nL4240402]
Helping to keep investor sentiment upbeat was the Bank of Canada, which left its key interest rate steady, as expected, and noted recent significant improvements in financial conditions and commodity prices, and a modest recovery in both consumer and business confidence. [ID:nN0479627]
$1=$1.10 Canadian Editing by Rob Wilson