April 4, 2008 / 3:13 PM / 11 years ago

UPDATE 1-Toronto stocks rally as resources climb

(Updates to midmorning)

TORONTO, April 4 (Reuters) - The Toronto Stock Exchange’s main index drove higher on Friday morning as investors picked up resource shares in a safe-haven move in the wake of fresh data that underscored concerns that the United States is sliding into a recession.

Miners of gold and other metals pushed upward, with Agnico-Eagle Mines (AEM.TO) rising C$1.73, or 2.5 percent, to C$70.07, and Goldcorp (G.TO) gaining 98 Canadian cents, or 2.5 percent, to C$40.63. The materials sector overall was up 2.3 percent.

The heavyweight energy group was buoyed by a gain in the price of oil. Suncor Energy (SU.TO) rose C$2.48, or 2.5 percent, to C$102.53, while Canadian Natural Resources (CNQ.TO) was up C$1.40, or 1.99 percent, at C$71.80.

The S&P/TSX composite index .GSPTSE was up 95.71 points, or 0.71 percent, at 13,647.00, but just four of its 10 main sectors higher.

Fertilizer companies Potash Corp of Saskatchewan POT.TO and Agrium AGU.TO were among the biggest gainers by weight, boosted after Mosaic (MOS.N) reported quarterly earnings that surged past expectations due to increased global demand and prices for phosphates and potash.

Mosaic is part of Canpotex, which handles potash exports from Saskatchewan for the company, as well as for Potash Corp and Agrium. Potash rose C$6.17, or 3.7 percent, to C$174.84, while Agrium was up C$2.79, or 4.2 percent, at C$69.54.

On the economic front, data showed the U.S. unemployment rate jumped to a 2-1/2 year high, highlighting worries the housing slump and credit crisis have infected the broader economy.

“Whenever there is trouble in financials, investors and speculators go to commodities sectors as a haven,” said Pierre Lapointe, assistant strategist and quantitative analyst at National Bank of Canada, in Montreal.

“So this morning, with the job numbers in the U.S. ... people are selling financials in the U.S., at least, and getting into commodities with commodity prices up.”

Toronto’s financial shares edged down 0.1 percent.

Meanwhile, a Statistics Canada report showed Canadian job growth slowed in March after two strong months, suggesting a softening jobs market and slowing economy.

Research In Motion RIM.TO eased C$2.17, or 1.8 percent, to C$121.25, a day after it propped up the Toronto index on the strength of its better-than-expected fourth-quarter earnings.

$1=$1.01 Canadian Reporting by Leah Schnurr and Jonathan Spicer; Editing by Peter Galloway

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