February 11, 2010 / 9:37 PM / 9 years ago

CANADA STOCKS-TSX gains on EU pledge to aid Greece

* TSX up 149.16 points, or 1.32 percent, at 11,435.49

* Greece rescue plan helps lift investor confidence

* Manulife, Sun Life fall on disappointing results (Updates to close, adds quote)

By Jennifer Kwan

TORONTO, Feb 11 (Reuters) - Toronto’s main stock index touched its highest level in a week on Thursday as a European Union rescue plan for debt-laden Greece helped lift market confidence and commodity prices.

Topping the list of big gainers were Potash Corp of Saskatchewan POT.TO, up 4.2 percent at C$117.07, Barrick Gold (ABX.TO), which climbed 2.7 percent to C$38.94, and Teck Resources TCKb.TO, up 6 percent at C$37.70.

A pledge by European leaders to support Greece helped to boost prices of oil above $75 a barrel, while gold and base metals were firmer. [O/R] [GOL/] [MET/L].

The Canadian dollar was also higher against the U.S. dollar on increased investor willingness to shoulder risk. [ID:nLDE61A0W2] [CAD/]

“You’re getting some form of backstop for Greece. That was the key thing that everyone is looking at,” said John Johnston, chief strategist for Harbour Group at RBC Dominion Securities.

Johnston noted there was some underlying disappointment, given the lack of details, but the EU essentially pledged to provide support for Greece if needed.

“The markets are by and large comfortable that Greece is not going to be allowed to default,” he said.

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE finished the day up 149.16 points, or 1.32 percent, at 11,435.49. It touched a high of 11,437.97, its highest level since Feb. 3.

The index’s materials sector, home to miners and fertilizer companies, led the way higher with a 3.4 percent gain. The oil and gas sector rose 1.5 percent.

EnCana Corp (ECA.TO), up 1.9 percent at C$33.07, and its oil sands and refining spinoff Cenovus Energy Inc (CVE.TO), up 2.9 percent at C$25.45, posted their first earnings as separate companies on Thursday. The pair reported lower profits but promised substantial production gains. [ID:nN11244290]

The index had been held back earlier in the day by weaker than expected quarterly results from two of Canada’s big life insurers. Manulife Financial (MFC.TO) was down 1.7 percent at C$19.16, and Sun Life Financial (SLF.TO) fell 3.1 percent to C$30.40.

“The market had certain expectations and they didn’t come through,” said Irwin Michael, portfolio manager at ABC Funds.

Both companies notched sharply higher quarterly profits on Thursday, thanks to gains on their stock investments and stronger sales, but both missed market expectations. [ID:nN11240504]

The blue chip S&P/TSX 60 index .TSE60 closed 8.80 points, or 1.33 percent, higher at 669.73.

$1=$1.05 Canadian Reporting by Jennifer Kwan; editing by Peter Galloway

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