February 6, 2009 / 9:54 PM / 9 years ago

CANADA STOCKS-TSX up for 4th straight day on stimulus optimism

* TSX rallies, touches highest level since Jan. 9

* Stock gains fueled by hopes for U.S. stimulus plan

* Canadian and U.S. economies bleed jobs in January

(Adds details, quote, updates figures)

TORONTO, Feb 6 (Reuters) - Toronto’s main stock index closed higher for a fourth straight session on Friday in a broad rally as dismal U.S. jobs data fueled hopes for a U.S. stimulus package to help combat the recession.

The index finished the week up 3.6 percent, rising for a second consecutive week and recording the strongest weekly increase since mid-December.

The three pillars of the index kept the market higher with materials sector up 2.2 percent and financials up 1.8 percent. The energy sector rose 1.6 percent.

Key stocks on the upside included fertilizer company Potash Corp of Saskatchewan POT.TO, up 4.4 percent at C$110.80, Manulife Financial MFC.TO, which rose 4.02 percent to C$21.23, and Suncor Energy SU.TO, which was higher by 3.4 percent at C$25.49.

Much of the optimism focused on Washington’s stimulus package and a plan, expected to be announced on Monday, to rescue the ailing banking sector. [ID:nN05403943]

Boosted by that optimism, the market pierced the key 9,000 resistance level, said Francis Campeau, broker at MF Global Canada, in Montreal.

“Technicals look a bit better so I think there is a momentum and technical buying going on,” he said.

The S&P/TSX composite index .GSPTSE closed up 147.04 points, or 1.66 percent, at 9,008.02, with eight of its 10 main groups higher. The consumer staples and health care sectors dropped 1.4 percent and 0.8 percent, respectively.

The rally came as U.S. job losses accelerated in January, the most severe monthly loss since Dec 1974, adding to evidence that the economy is in urgent need of stimulus. [ID:nN06462826]

In Canada, January data showed the economy suffered its worst job losses in more than three decades. [ID:nN06253705]

Among individual stocks, tech bellwether Research in Motion RIM.TO rallied 3.1 percent to C$72.10, helping to push up the broader sector by 2.8 percent. ($1=$1.22 Canadian) (Reporting by Jennifer Kwan; Editing by Jeffrey Hodgson)

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