August 6, 2008 / 9:15 PM / 11 years ago

UPDATE 4-Toronto stocks get big lift from resources

(Adds details, quotes)

* TSX rebounds 1.6 pct after Tuesday’s steep loss

* Resource sectors lead upside

* Agrium gains 5 percent after strong quarterly earnings

By Leah Schnurr

TORONTO, Aug 6 (Reuters) - The Toronto Stock Exchange’s main index rallied more 200 points on Wednesday, spurred by a rebound in resource sectors and a strong quarterly profit from fertilizer firm Agrium.

The materials and energy groups provided the main impetus for the gains as investors returned to stocks that were battered in a steep selloff in the previous session.

The energy sector benefited from the rebound even though oil prices fell to a low near $117 a barrel before settling at $118.58. In Toronto, Canadian Natural Resources (CNQ.TO) gained 5.7 percent.

Agrium AGU.TO rose 5.3 percent after the world’s third-largest nitrogen producer said profit more than doubled in the wake of surging demand and prices for fertilizer.

“Probably things got overdone yesterday,” Douglas Davis, president of Davis-Rea, said of Tuesday’s slide.

“Oil can come back to $80 to $100 and then it can go to $200, so if you’re a long-term investor you would want to be in energy all the way through,” Davis added.

The S&P/TSX composite index .GSPTSE closed up 211.31 points, or 1.6 percent, at 13,453.51 with all but two of its 10 main sectors pointing higher.

The energy and materials sectors rose 2.7 percent and 3.2 percent, respectively. In the oil patch, Canadian Natural Resources was up C$4.28 at C$79.28, while Suncor Energy (SU.TO) rose C$1.92, or 3.7 percent, to C$54.30.

Agrium closed up C$4.38 at C$87.16, and fellow fertilizer company Potash Corp of Saskatchewan POT.TO rose C$8.80, or 4.9 percent, to C$189.30.

Investors fled both groups in the previous session amid a broad decline in commodities, helping drive the benchmark index down by nearly 2 percent.

However the sectors only recovered some of the losses from their drubbing, which saw energy shares knocked down 5 percent and materials down 8.6 percent on Tuesday.

Tech heavyweight Research In Motion RIM.TO helped pull its sector up 2.8 percent, as shares of the BlackBerry-maker rose C$6.31, or 5 percent, to C$133.23.

Telecoms company BCE Inc (BCE.TO) climbed after it said its profit fell, but it signed up long-term phone subscribers at the fastest pace in about 2-1/2 years. BCE was up 50 Canadian cents, or 1.3 percent, at C$39.66.

Davis said the U.S. Federal Reserve’s decision on Tuesday to hold interest rates steady, as expected, also helped lift Bay Street, as the “move to hold rates was generally positive for North American economies.”

Market volume was 348 million shares worth C$6.9 billion. Advancers outpaced decliners 885 to 606. The blue chip S&P/TSX 60 index .TSE60 closed up 14.09 points, or 1.78 percent, at 804.32.

In New York, stocks added onto the previous day’s big gains amid a further drop in oil prices and a reassuring outlook from Cisco Systems (CSCO.O). The Dow Jones industrial average .DJI closed up 40.30 points, or 0.35 percent, at 11,656.07, and the Nasdaq composite index .IXIC rose 28.54 points, or 1.21 percent, to 2,378.37. ($1=$1.05 Canadian) (Editing by Rob Wilson)

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