July 16, 2008 / 8:51 PM / 11 years ago

UPDATE 3-Toronto stocks rise as financials surge

(Adds details, comments)

*Financial shares lead jump in Toronto stocks

*Wells Fargo results allay some U.S. mortgage worries

*Energy and resources slide as oil and gold prices decline

By Wojtek Dabrowski

TORONTO, July 16 (Reuters) - The Toronto Stock Exchange’s main index finished nearly 150 points higher on Wednesday as surprisingly strong quarterly results from a U.S. bank invigorated the financial sector and helped the benchmark shake off a weak showing by energy and materials issues.

Seven of the 10 main groups of the S&P/TSX composite index .GSPTSE moved higher, including financials, which surged 5.9 percent after Wells Fargo & Co (WFC.N), the fifth-biggest U.S. bank, posted results that eased investor fears about mortgage losses.

Toronto-Dominion Bank rose C$4.06, or 7.6 percent, to close at C$57.57 — the session’s second biggest net gain. National Bank of Canada (NA.TO) came in third, adding C$3.89, or 8.5 percent, to end at C$49.64.

The biggest net gainer of the day was BlackBerry maker Research In Motion RIM.TO, whose volatile shares swung C$4.79, or 4.5 percent, higher at C$111.00

“You’re still seeing weakness in oil and weakness in the mines, but the financials powered up this afternoon,” said Julie Brough, vice-president at Morgan Meighen & Associates.

Despite the positive results from Wells Fargo, she said problems in the U.S. financial system continue to cause uncertainty.

“It’s very hard to run the economy effectively without a banking system running smoothly and right now in the U.S. your financial system is not running smoothly,” she said.

Toronto’s energy and materials groups fell 2.09 percent and 1.26 percent, respectively, as oil prices eased and also reduced the appeal of gold as a hedge against inflation.

EnCana Corp (ECA.TO) dropped C$2.62, or 3.15 percent, to C$80.60. Agnico-Eagle Mines (AEM.TO) fell C$2.59, or 3.4 percent, to C$73.23.

The S&P/TSX composite index .GSPTSE rose 146.24 points, or 1.09 percent, to close at 13,503.80.

The S&P/TSX 60 index of Canadian blue chips added 10.40 points to end at 807.73.

In the United States, the Dow Jones industrial average .DJI charged ahead to finish 276.74 points, or 2.5 percent, higher at 11,239.28.

“After having six weeks of dreadful pounding, it’s a relief rally,” said Brant Securities stockbroker Sal Masionis.

The tech-heavy Nasdaq added 69.14 points to close at 2,284.85.

$1=$1.00 Canadian Reporting by Wojtek Dabrowski; editing by Peter Galloway

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