April 9, 2009 / 2:46 PM / 10 years ago

CANADA STOCKS-TSX rallies on upbeat U.S. banking news

* TSX up 142.01 points at 9,111.29

* Financials surge on Wells Fargo news

* Higher oil price boosts energy stocks (Adds details, comments)

By Frank Pingue

TORONTO, April 9 (Reuters) - Toronto’s main stock index was up more than 1.5 percent on Thursday morning as weighty bank issues rallied on upbeat news out of the U.S. banking sector, while higher oil prices buoyed energy shares.

The quick start by banks was being credited to upbeat preliminary quarterly results delivered by Wells Fargo & Co (WFC.N), which fueled investor hopes that the battered U.S. banking sector may be headed for stability. [ID:nN09260398]

Shares of Toronto-Dominion Bank (TD.TO) were up 3.5 percent at C$46.05, while Royal Bank of Canada (RY.TO) was up 3 percent at C$39.09.

“There are probably a number of investors who are a little antsy sitting on money virtually earning them zero percent,” said Irwin Michael, portfolio manager at ABC Funds.

“So it’s understandable with any little bit of positive news, or news which is less bad, the market will probably take a positive take, and that encourages people who are very nervous siting on cash to do something.”

At 10:25 a.m. (1425 GMT), the S&P/TSX composite index .GSPTSE was up 142.01 points, or 1.58 percent, at 9,111.29. Earlier, it had risen as much as 2.2 percent to 9,164.81.

The rally added to the the Toronto Stock Exchange’s 1.6 percent gain on Wednesday, which saw the index close at a session high.

Seven of the TSX’s 10 sectors were higher, led by a 3.6 percent surge in the financial sector.

The energy group was up 2 percent as oil prices climbed above $52 a barrel as higher stock markets revived thoughts of an economic recovery and increased demand for commodities. [ID:nSP226434]

Suncor Energy (SU.TO) was up 3 percent at C$31.43, while EnCana (ECA.TO) was up 1.8 percent at C$54.97.

The TSX will be closed on Friday for the Easter holidays, which Michael said was also partly responsible for the higher start to the Thursday’s session.

“It’s a long weekend and people like to cover their shorts. They don’t like to speculate because sometimes things happen over long weekends.”

$1=$1.23 Canadian Editing by Rob Wilson

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