May 15, 2008 / 9:37 PM / in 10 years

UPDATE 3-Toronto stocks yanked higher by robust resources

(Adds details, quotes)

*Index closes at record high

*Resource and financial sectors rally

By Leah Schnurr

TORONTO, May 15 (Reuters) - The Toronto Stock Exchange’s main index popped up more than 1 percent on Thursday, propelled further into record high territory by strong resource and financial shares.

Inmet Mining IMN.TO was the biggest net gainer on the day, rising C$6.25, or 9.3 percent, to C$73.75. Fertilizer company Potash Corp of Saskatchewan (POT.TO) was also among the leaders, finishing up C$5.28, or 2.7 percent, at C$204.50.

Gold producers also jumped, benefiting from rising gold prices. Agnico-Eagle Mines (AEM.TO) was up C$3.38, or 5.3 percent, at C$67.29, while the gold subindex gained 3.6 percent.

The S&P/TSX composite index .GSPTSE closed up 201.75 points, or 1.38 percent, at 14,828.06 with all but one of its 10 main sectors moving higher.

The surge helped the benchmark climb further into record territory, continuing the week’s trend after it broke last summer’s record high on Monday.

The financials sector, the biggest group on the index by weight, rose 1.6 percent, with Toronto-Dominion Bank (TD.TO) rising 94 Canadian cents, or 1.4 percent, to C$68.51, and Canadian Imperial Bank of Commerce (CM.TO) up 83 Canadian cents, or 1.1 percent, at C$74.84.

Adrian Mastracci, portfolio manager and president at KCM Wealth Management Inc., in Vancouver, said that banks were helped by easing trepidation over what problems may be still lurking in the financial sector.

“I think as investors look at more news being disseminated, as some of the financials have reported the potential losses that they’re going to take, I guess they feel that we know more of the situation,” Mastracci said.

“The more they know, they more they feel better about the prospects going forward, and I think there’s some of that in there today.”

On the downside, FirstService Corp (FSV.TO) tumbled C$2.77, or 12.2 percent, to C$19.96 after the property services firm swung to a fourth-quarter loss as it was stung by unfavorable market conditions.

The telecoms sector was the only group in negative territory, giving up 0.2 percent.

Shares of Lundin Mining LUN.TO added 68 Canadian cents, or 8.8 percent, to C$8.38 after it reported first-quarter profit rose, helped by rising copper and lead prices, as acquisitions increased production.

The Toronto benchmark has climbed more than 20 percent from the lows seen in January, when it dipped below the 12,000 mark amid worries over the health of the U.S. economy and troubles in the financial and credit markets.

Since then it has been spurred higher by red-hot commodities prices, and recent optimism that the worst of the credit problems have been seen. Analysts have also noted that the current round of corporate results generally have been better than had been feared.

“We’re getting to the end of earnings season and we got through this without any terribly nasty surprises,” said Rick Hutcheon, president and chief operating officer at RKH Investments.

“I think that the mood of investors is probably starting to gain a little traction, and that we’re starting to feel a little more optimistic that perhaps the worst of the credit issues are beginning to recede.”

Market volume was 441 million shares worth C$8.1 billion. Advancers outpaced decliners 985 to 655. The blue chip S&P/TSX 60 index .TSE60 closed up 13.14 points, or 1.51 percent, at 884.73.

In New York, stocks were up as a pullback in oil prices calmed worries about inflation. The Dow Jones industrial average .DJI closed up 94.28 points, or 0.73 percent, at 12,992.66, and the Nasdaq Composite Index .IXIC rose 37.03 points, or 1.48 percent, to 2,533.73. ($1=$1.00 Canadian) (Editing by Peter Galloway)

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