April 15, 2008 / 9:43 PM / 11 years ago

UPDATE 3-Toronto stocks energized by record oil prices

(Adds details, quotes)

By Leah Schnurr

TORONTO, April 15 (Reuters) - A record high for oil prices drove the Toronto Stock Exchange’s main index higher on Tuesday, with stronger resource issues overshadowing lingering worries about a weak earnings season.

Toronto’s energy sector gained 1.8 percent as crude prices surged amid supply worries and weakness in the U.S. dollar. U.S. oil prices settled $2.03 higher at $113.79 a barrel, before hitting a record of $114.08 in late electronic trade.

Suncor Energy (SU.TO) was up C$2.37, or 2.2 percent, at C$112.12, and Canadian Natural Resources (CNQ.TO) gained C$1.21, or 1.5 percent, to C$83.53.

“It’s a familiar theme yet again,” said Elvis Picardo, investment strategist at Northern Securities Inc in Vancouver. “It’s energy and materials driving the upside and that’s more than offsetting some weakness in the financials and info tech index.”

The S&P/TSX composite index .GSPTSE closed up 112.35 points, or 0.82 percent, at 13,850.95 with six of its 10 main groups in an upswing.

The materials sector, home to resource shares, also helped lift the benchmark with a gain of 1.8 percent. Potash Corp of Saskatchewan POT.TO rose C$2.80, or 1.5 percent, to C$188.15, and Agrium AGU.TO gained C$2.41, or 3.1 percent, to C$80.50.

The sector’s gold producer subindex rose 1.6 percent, lifted by strengthening bullion prices. Barrick Gold (ABX.TO) advanced 55 Canadian cents, or 1.3 percent, to C$44.40, and Goldcorp (G.TO) moved up C$1.28, or 3.1 percent, to C$42.07.

On the downside, the lightweight tech sector slipped 0.9 percent, hurt by falling shares of MacDonald Dettwiler and Associates MDA.TO, which were off 60 Canadian cents, or 1.4 percent, at C$43.29. Last week, the Canadian government blocked the sale of MDA’s satellite unit to U.S. company Alliant Techsystems ATK.N.

Also in the sector, contract electronics maker Celestica (CLS.TO) was down 45 Canadian cents, or 6.3 percent, at C$6.67.

Despite the day’s strong advance, Picardo said concerns remain that quarterly corporate results will be weak — a fact that was underscored last week by an unexpected decline in profit at bellwether General Electric (GE.N).

“I think the key driver is going to be corporate earnings,” said Picardo. “We’re just beginning to see numbers come out and, frankly, they haven’t been terribly encouraging.”

The heavyweight financials sector edged down 0.2 percent, while National Bank of Canada (NA.TO) was down 80 Canadian cents, or 1.6 percent, at C$49.56, and Bank of Montreal (BMO.TO) dipped 26 Canadian cents, or 0.6 percent, to C$45.81.

“Investors are expecting some more fall on the earnings side,” said Adrian Mastracci, portfolio manager and president at KCM Wealth Management Inc., in Vancouver.

“Especially in financials, there’s certainly more pain to come. Regardless of who’s report you happen to subscribe to, we still have a lot of losses to wash under the bridge.”

Grocery chain Metro MRUa.TO posted a decline in second-quarter profit, stung by competition in the key Ontario market. Metro’s shares finished up 46 Canadian cents, or 1.9 percent, at C$24.50.

Market volume was 388 million shares worth C$6.2 billion. Advancers outpaced decliners 878 to 686. The blue chip S&P/TSX 60 index .TSE60 closed up 6.91 points, or 0.85 percent, at 816.82.

In New York, stocks were also boosted by record oil prices, while financial shares rose after several U.S. regional banks reported better-than-expected quarterly results. The Dow Jones industrial average .DJI rose 60.41 points, 0.49 percent, to 12,362.47, while the Nasdaq Composite Index .IXIC was up 10.22 points, or 0.45 percent, to 2,286.04.

$1=$1.02 Canadian Editing by Peter Galloway

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