February 19, 2008 / 10:05 PM / 11 years ago

UPDATE 3-Toronto stocks surge 220 pts on golds, oils

(Adds detail, quotes)

By Leah Schnurr

TORONTO, Feb 19 (Reuters) - The Toronto Stock Exchange’s main index soared more than 200 points on Tuesday, lifted by robust resource issues and record-setting oil prices.

Gains in gold, platinum and other commodities helped push the index higher, as the materials sector jumped 4.9 percent and the gold-producers subindex surged 6.1 percent.

Potash Corp of Saskatchewan POT.TO was up C$7.90, or 5.3 percent, at C$157.25. Agnico-Eagle Mines (AEM.TO) rose C$3.80, or 6 percent, to C$67.00, while the price of gold was boosted by a weaker U.S. dollar.

In the energy sector, Canadian Natural Resources (CNQ.TO) helped lead the rally, gaining C$2.95, or 4.5 percent, to C$68.05, while Suncor Energy (SU.TO) rose C$2.73, or 2.8 percent, to C$99.59. The group as a whole, which makes up about 25 percent of the main index, added 2.1 percent.

Oil prices climbed more than 4 percent to hit a record high of $100.10 a barrel, before settling at $100.01 amid expectations of tight supplies.

“The energy shares and golds are the big drivers today,” said John Ing, president of Maison Placements Canada. “The oils in particular are posting some big gains.”

The S&P/TSX composite index .GSPTSE closed up 220.98 points, or 1.67 percent, at 13,447.74, with six of its 10 main groups higher. But it was the resource sectors that provided the lion’s share of the day’s strength.

“There has been pent-up demand for the commodities (issues) because they have been trading sideways for a while now, despite the fact that prices have been sustained at fairly high levels,” said Elvis Picardo, investment strategist at Northern Securities Inc. in Vancouver.

“It’s a delayed reaction, I think. The gain in the commodity groups today has let some money that has been on the sidelines to get into the market.”

Expectations of another interest rate cut from the Bank of Canada also buoyed the Toronto benchmark, as data showed the inflation rate slowed in January as discounts in vehicle prices offset rising gasoline costs.

On the downside, Bank of Montreal (BMO.TO) slipped after it said it will take a C$490 million pretax charge in the first quarter due to troubles in the credit market. BMO finished off 3 Canadian cents, or 0.1 percent, to C$53.80 after earlier falling as low as C$52.98.

Thomson Corp TOC.TO edged up 2 Canadian cents, or 0.1 percent, to C$34.55 after regulators in Europe, the United States and Canada conditionally approved the electronic publisher’s acquisition of Reuters RTR.L.

Elsewhere, Cordero Energy Inc COR.TO gained 19 Canadian cents, or 4.6 percent, to C$4.29 after Enmax Corp, Calgary’s power utility, said it will by the junior gas producer for about C$160 million.

Market volume was 442 million shares worth C$7.6 billion. Advancers outpaced decliners 1,034 to 627. The blue chip S&P/TSX 60 index .TSE60 closed up 14.87 points, or 1.92 percent, at 787.62.

On Wall Street, stocks reversed direction after a selloff in telecoms companies and the jump in crude made investors nervous over the impact on consumers. The Dow Jones industrial average .DJI finished down 10.99 points, or 0.09 percent, at 12,337.22. The Nasdaq composite index .IXIC fell 15.60 points, or 0.67 percent, to 2,306.20.

$1=$1.02 Canadian Editing by Rob Wilson

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