April 5, 2011 / 8:53 PM / 7 years ago

CANADA STOCKS-TSX hits 4-week high as miners rally

 * TSX rises 52.18 points to 14,270.53
 * Highest level since March 7
 * Five index sectors rise  (Updates to close, adds details, quotes)
 By Claire Sibonney
 TORONTO, April 5 (Reuters) - Toronto’s main stock index closed higher on Tuesday, hitting a four-week peak on the back of miners as gold jumped to a record high and copper shrugged off an interest rate hike in China.
 Shares of precious metal miners surged 4.6 percent. [GOL/] as the price of gold surpassed $1,450 an ounce on safe-haven buying spurred by new highs for crude and corn prices, which fanned inflation fears. A Portuguese credit downgrade drew attention back to euro zone woes, which also helped push up the gold price.
 Among the biggest gainers, Barrick Gold Corp (ABX.TO) shot up 5.2 percent to C$52.36, and Goldcorp (G.TO) soared 5.8 percent to C$50.30.
 “It comes down to inflation. It’s difficult for people to deny that inflation is a head wind going forward and I think it’s starting in the emerging markets and we’re seeing it come out of some of the developed markets,” said Philip Petursson, managing director of portfolio advisory group at Manulife Asset Management.
 “I think it’s just a matter of time before it shows ... more of a headline number in North America. The rising gold, I think, is reflective of that as well as reflective of the weak fundamentals around the U.S. dollar.”
 Base-metal miners rose 1.5 percent, pushing the index’s heavyweight materials sector up 2.9 percent as the price of copper ended higher, even though China’s giant appetite for the metal has softened since the start of the year. [MET/L]
 Also on Tuesday, China’s central bank raised interest rates for the fourth time since October in a bid to cool stubborn price pressures, a move that might curb its demand for metals. [ID:nL3E7F51LX]
 Diversified miner Teck Resources TCKb.TO added 2.3 percent to C$56.38, while First Quantum Minerals (FM.TO) rose 1.9 percent to C$140.
 Petursson noted that strength in the miners was also due to expectations of more takeover deals in the sector after Minmetals Resources (1208.HK), China’s biggest metals trading firm, offered $6.5 billion on Monday to buy Equinox Minerals EQN.AXEQN.TO.  [ID:nL3E7F30DI]
 The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended up 52.18 points, or 0.37 percent, at 14,270.53, its highest level since March 7. Five of the index’s 10 main sectors rose.
 Financials dropped 0.6 percent with Royal Bank of Canada (RY.TO) falling 0.5 percent to C$60.30, and Toronto-Dominion Bank (TD.TO) losing nearly 1 percent to C$85.29.
 The index’s energy sector also declined, down 0.3 percent, as U.S. crude oil futures settled lower ahead of weekly inventory reports, although prices held above $108 a barrel. [O/R]
 Suncor Energy (SU.TO) was down almost 1 percent at C$43.60, and Canadian Oil Sands Trust COS.TO was off 1.1 percent at C$33.13.
 ($1=$0.96 Canadian)  (Reporting by Claire Sibonney; editing by Peter Galloway)                                        

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