August 9, 2010 / 2:45 PM / 9 years ago

CANADA STOCKS-TSX rises as oil and metals prices firm

*TSX up 27.02 points, or 0.23 percent, to 11,826.99

*Nine of 10 main sectors higher

*Menu Foods rises 45 percent after deal news (Adds details, quote)

By Jennifer Kwan

TORONTO, Aug 9 (Reuters) - Toronto’s main stock index was slightly higher on Monday morning as firm oil and base-metals prices helped to boost the market’s resource-linked shares.

The energy sector got a boost from firm oil prices, which rose above $81 a barrel, helped by U.S. dollar weakness. [O/R] Suncor Energy (SU.TO) was up 0.3 percent at C$34.21.

Copper prices edged higher, supported in part by the generally weaker U.S. dollar and sliding inventories. [MET/L] Teck Resources TCKb.TO rose 2 percent to C$36.31.

Financial shares also rose, boosted by Royal Bank of Canada (RY.TO), which climbed 1 percent at C$53.47.

Weighing on the index’s materials sector, down 0.3 percent, were gold-mining stocks, including Barrick Gold (ABX.TO), which fell 0.7 percent to C$44.34. Fertilizer producer Potash Corp POT.TO fell 0.8 percent to C$115.66 following a runup last week.

At 10:12 a.m. (1412 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was up 27.02 points, or 0.23 percent, to 11,826.99, with nine of its 10 main sectors higher.

Despite the rise, investors remained cautious on the outlook for the second half of the year, said Barry Schwartz, vice president and portfolio manager Baskin Financial Services.

“There’s some concerns. Second-quarter earnings were strong but what’s the real story as we head into the third and fourth quarter?” he said.

There was also anxiety going into Tuesday’s policy meeting of the U.S. Federal Reserve’s Open Market Committee.

“No one expects them to raise rates, but there’s chatter out there of new forms of quantitative easing and different ways to continue to provide liquidity to the system as banks in U.S. are still not lending and consumers are still cautious on spending,” Schwartz said.

Aecon Group Inc (ARE.TO), Canada’s biggest publicly traded construction company, said it entered into a letter of intent to acquire assets of Canadian oil sands services company Cow Harbour Construction Ltd for about C$180 million in a bid to expand its base among mining clients in Alberta. [ID:nSGE6780CS] Aecon shares rose 0.8 percent to C$11.65.

Menu Foods Income Fund MEW_u.TO, a top net gainer, climbed 45 percent to C$4.74. Simmons Pet Food Inc is buying Menu Foods for about C$239 million, including the assumption of debt. [ID:nSGE67807Z]

Research In Motion RIM.TO, up 1.8 percent at C$55.94, was also in focus on Monday as the BlackBerry maker and Saudi mobile firms were testing three servers to send communications and data through Saudi Arabia before Canada to address Riyadh’s concerns over security, a Saudi official said on Sunday. [ID:nLDE6770AQ]

$1=$1.03 Canadian Reporting by Jennifer Kwan; editing by Peter Galloway

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