March 17, 2011 / 9:31 PM / 8 years ago

CANADA STOCKS-Resources help TSX bounce back from 3-day slide

 * TSX soars 221.33 points to 13,746.15
 * Eight of index’s 10 sectors stronger
 * Oil, copper, gold all firmer  (Adds comments, U.S. economic data, Air Canada)
 TORONTO, March 17 (Reuters) - Toronto’s main stock index broke a three-day slide on Thursday, ending sharply higher on rising prices for oil and other commodities, though Japan’s nuclear crisis and clashes in the Middle East kept investors uncertain about the near-term outlook.
 The powerhouse energy sector surged almost 4 percent as the price of crude shot up by roughly the same amount on fears of further geopolitical turmoil in the Middle East and North Africa. [O/R] [ID:nL3E7EH0EX]
 Suncor Energy (SU.TO) jumped 4.5 percent to C$43.96, and Canadian Natural Resources (CNQ.TO) rallied almost 5 percent to C$48.23.
 Japanese engineers worked through the night to restore a power cable to a crippled nuclear power plant in the hope of restarting pumps desperately needed to pour cold water on overheating fuel rods and avert a catastrophe. [ID:nL3E7EH2SM]
 “We’re waiting for the headlines out of Japan to be less bad and that’s exactly what we’re getting,” said Barry Schwartz, vice-president and portfolio manager at Baskin Financial Services.
 “I wouldn’t say they’re positive, but at least encouraging headlines ... it’s just a relief rally.”
 The index materials sector was up 1.7 percent, boosted by base-metal miners, which climbed almost 4 percent as the price of copper hit its highest level in more than a week. Teck Resources TCKb.TO advanced more than 5 percent to C$53.72. [MET/L]
 “One would think that if Japan and the Middle East and North Africa and euro zone are going to cause a slowdown in growth, that you wouldn’t want to be heavy to the commodities,” Schwartz said, noting that he wasn’t aggressively taking on positions until there is a clearer picture of how events will unfold.
 The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended up 221.33 points, or 1.64 percent, at 13,746.15. Eight of its 10 main groups were stronger.
 “Technically, we still look poor, so we may have an up day today but there might not be a lot of follow-through in the next couple days,” said said Paul Gardner, partner and portfolio manager at Avenue Investment Management.
 Gardner said expectations of rebuilding in Japan will support the market longer term, especially forest-product companies.
 Canfor Corp (CFP.TO) rallied 7.8 percent to C$14.00, and International Forest IFPa.TO soared 12 percent to C$7.35.
 Uranium producers, however, continued to be pummeled over the nuclear crisis in Japan. Cameco Corp (CCO.TO) dipped to a six-month low, falling almost 6 percent to C$27.73. [ID:nN17128176]
 Financial shares were up 0.7 percent, lifted by upbeat U.S. economic reports. Royal Bank of Canada (RY.TO) gained 1.2 percent to C$59.76, and Manulife Financial (MFC.TO) bounced up 1.8 percent to C$16.43.
 U.S. data on Thursday showed growth was accelerating. Claims for new unemployment benefits fell last week, and factory activity in the country’s Mid-Atlantic region expanded at its quickest rate in 27 years. [ID:nN17148632]
 “Staggering number, given what’s happened with housing and unemployment and worries about worldwide riots and black swan events, we produced these types of strong economic numbers,” Baskin’s Schwartz said.
  As well, FedEx Corp (FDX.N), the No. 2 package delivery company, often seen as a barometer of global economic growth, said it expects improving revenue and profit this quarter and beyond, even as fuel prices mount. [ID:nN17126969]
 Gold-mining shares reversed earlier losses, rising 0.5 percent as bullion prices benefited from a weaker U.S. dollar. Goldcorp (G.TO) rose 1 percent to C$45.91 [GOL/]
 Gammon Gold GAM.TO added 3.1 percent to C$8.40 after Capital Gold (CGC.A) reiterated its support for Gammon’s takeover offer. [ID:nN17132651]
 In other company news, Research In Motion RIM.TO rose 1 percent to C$60.04 after the BlackBerry maker said on Wednesday it has big plans to make better use of its nerve center computers. [ID:nN16259058]
 Lululemon Athletica LLL.TO sank 4.4 percent to C$75.26, after it posted a higher quarterly profit but said it was unable to meet soaring demand for its activewear clothing lines. [ID:nN16138953]
 Air Canada ACa.TO fell 3.3 percent to C$2.62 after the nation’s largest carrier said late on Wednesday it is suspending unprofitable routes and cutting the frequency of others as it wrestles with high fuel prices. [ID:nN17127701]
 ($1=$0.99 Canadian)  (Reporting by Claire Sibonney; editing by Peter Galloway)                                         

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