May 19, 2009 / 8:42 PM / 10 years ago

CANADA STOCKS-TSX rally led by resources, financial issues

* TSX finishes up 3.46 percent at 10,100.95

* Index catches up after market closed on Monday

* Energy sector up 5.5 pct as oil rises (Adds details, quote)

By Jennifer Kwan

TORONTO, May 19 (Reuters) - Toronto’s main stock index rallied sharply on Tuesday, reclaiming most of last week’s losses, as higher oil prices boosted energy issues and as it caught up with a rise in U.S. stocks on Monday, when the Toronto market was closed.

The energy sector, up 5.5 percent, led the rally as oil prices climbed with Canadian Natural Resources (CNQ.TO) up 7.1 percent at C$62.06, and Suncor Energy (SU.TO) higher by 4.2 percent at C$35.08.

“It’s a 3 percent catch up from yesterday and basically 1 percent on its own,” said Francis Campeau, broker at MF Global Canada, in Montreal.

After rallying nearly 3.9 percent earlier on Tuesday, the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE retreated slightly to finish up 338.10 points, or 3.46 percent, at 10,100.95, with all 10 of the index’s main groups firmly in the black. The TSX was closed on Monday for Canada’s Victoria Day holiday.

Tuesday’s gains nearly recovered the resource-laden TSX’s 4.6 percent loss for last week.

Market watchers said Toronto was largely playing catch up with U.S. stocks, which rallied on Monday, in part, on the back of better than expected results from Lowe’s Cos Inc (LOW.N), the No. 2 U.S. home improvement retailer.

While U.S. stocks were mostly weaker on Tuesday, analysts said the markets held up well given U.S. data that showed a slide in housing starts and permits in April. [ID:nN19418875]

“The market is extremely resilient,” said Campeau.

The resource-laden TSX got a boost from firmer commodity prices, with oil climbing to settle at $59.65 a barrel as a flurry of U.S. refinery problems fueled supply fears. [ID:nSIN131895]

Gold was also firmer [nLJ936150], helping to boost the materials sector, which was up 3 percent.

Financials rose 3.7 percent as investors were reassured by news several major U.S. banks are seeking to repay government bailout funds, said Campeau. [ID:nN19421829]

Manulife Financial (MFC.TO) rose 5.7 percent at C$22.20, while Royal Bank of Canada (RY.TO) rose 3.6 percent to C$43.46 and Bank of Nova Scotia (BNS.TO) climbed 3.6 percent to C$36.26. ($1=$1.16 Canadian) (Reporting by Jennifer Kwan; Editing by Jeffrey Hodgson)

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