October 6, 2009 / 2:21 PM / in 8 years

CANADA STOCKS-TSX rises sharply as resource stocks rally

 * TSX up 202.88 points at 11,305.50
 * Gold-mining and energy shares lead rally
 * Australia rate hike boosts sentiment  (Adds details and comments)
 By Frank Pingue
 TORONTO, Oct 6 (Reuters) - Toronto’s main stock index was up nearly 2 percent on Tuesday morning as Goldcorp (G.TO) and other gold-mining shares jumped as gold prices hit a record high, and energy shares rose on higher oil prices.
 Shares of Goldcorp were up 4.8 percent at C$44.23, while Barrick Gold Corp (ABX.TO) followed with a gain of 3.4 percent to C$41.04.
 Gold prices rose to a record high of $1,036.40 an ounce after a media report, later denied, that Gulf Arab states were in talks to abandon the U.S. dollar in oil trade. [GOL/]
 Energy shares got a boost after a U.S. government agency raised its forecast for world oil demand for the fourth quarter [O/L], lifting oil prices above $71 a barrel.
 Shares of Suncor Energy (SU.TO), the biggest contributor to the index’s gain, were up 2.6 percent at C$36.42, while shares of Talisman Energy TLM.TO rose 4.1 percent to C$19.04.
 At 10:00 a.m. (1400 GMT), the S&P/TSX composite index .GSPTSE was up 202.88 points, 1.83 percent, at 11,305.50.
 Also helping boost investor sentiment was the Reserve Bank of Australia’s decision to raise interest rates, making it the first G20 central bank to hike rates. The move gave credence to the view that the recession is easing.
 “There’s a general rotation into riskier assets including equities and commodities,” said Fergal Smith, managing market strategist at Action Economics.
 “The rate hike perse is not good for equities, but it does provide tangible evidence that central bankers are getting comfortable with (the idea of a) recovery.”
 ($1=$1.06 Canadian)  (Editing by Peter Galloway)                                      

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