September 19, 2008 / 9:01 PM / 10 years ago

UPDATE 3-Toronto stocks make huge gain on U.S. rescue plans

* TSX benchmark index surges more than 7 pct

* Financials climb on news of U.S. rescue plans

* Energy issues rise as oil rebounds to $100 a barrel (Adds details, background)

TORONTO, Sept 19 (Reuters) - The Toronto Stock Exchange’s main index soared to its biggest gain since 1987 on Friday, as a series of U.S.-led moves to shore up the global financial system sparked a resource-led rally across all stock sectors.

The market’s energy and materials sectors led the way with gains of 8.9 percent and 9.6 percent.

Liquidity was restored to troubled markets by a U.S. plan to take over hundreds of billions of dollars worth of toxic mortgage debt and to slap a temporary ban on short-selling.

The moves, which followed a coordinated effort by central banks on Thursday to inject billions into the financial system, also sent the previously underperforming financials sector up 5.7 percent to its highest level in three months.

The S&P/TSX composite index .GSPTSE rose 848.42 points, or 7.03 percent, to finish at its session-high of 12,912.99, marking its largest one-day percentage gain since the aftermath of the October 1987 stock market crash.

“You only get days like this once in a blue moon,” said Paul Hand, managing director at RBC Capital Markets.

“It’s so sweeping, not just the market action, but the unprecedented number of initiatives with respect to market activity. It’s unbelievable.”

Oil rose by $6.67 to $104.55 a barrel to post its biggest three-day rally in a decade. Suncor Energy (SU.TO) rose 14.3 percent to C$52.00, while Canadian Natural Resources (CNQ.TO) gained 11.9 percent to C$87.31.

Among financial issues, Toronto-Dominion Bank (TD.TO) leaped 9.6 percent to C$64.94, Royal Bank of Canada (RY.TO) gained 7.2 percent to C$51.43, while insurer Great-West Lifeco climbed 10.2 percent to C$35.29.

Analysts said that while the one-day rally may have gone too far, the market has likely seen its bottom.

“It would certainly seem as though the events of the last two weeks have marked a watershed in terms of the willingness of the authorities to step in and prevent systemic risk to the system,” said Gavin Graham, chief investment officer at Guardian Group of Funds.

$1=$1.05 Canadian Reporting by Cameron French; Editing by Peter Galloway

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below