April 21, 2008 / 9:27 PM / 10 years ago

UPDATE 3-Toronto stocks drive higher on soaring oil prices

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By Leah Schnurr

TORONTO, April 21 (Reuters) - The Toronto Stock Exchange’s main index pushed higher for the sixth session in a row on Monday, propelled by robust energy shares as the price of oil hit yet another record high.

The oil and gas group climbed 1.7 percent as oil prices surged to over $117 a barrel. Suncor Energy (SU.TO) rose C$2.87, or 2.5 percent, to C$119.51, while Canadian Natural Resources (CNQ.TO) jumped C$2.98, or 3.5 percent, to C$88.15.

U.S. crude settled up 79 cents at $117.48 a barrel, boosted by supply worries as rebels cut Nigerian supplies and a Scottish refinery strike threatened North Sea production.

“I think that what oil is telling you is there’s not really a global slowdown going on,” said Paul Harris, portfolio manager at Avenue Investment Management. “As oil continues to do well, I think Canadian stocks, like the Suncors of the world, will have to do well.”

The S&P/TSX composite index .GSPTSE closed up 84.10 points, or 0.59 percent, at 14,321.16 with all but two of its 10 main sectors higher.

The index has rallied more than 7 percent since the start of the month, helped by optimism that the worst of the credit crunch has passed. Monday’s gains put it within about 325 points of reaching its record high.

“From a technical perspective, it looks like you’ve bounced off that bottom two or three times, so I think you’re probably at a good base,” Harris said.

Fertilizer companies Agrium (AGU.TO) and Potash Corp of Saskatchewan (POT.TO) also helped lift the benchmark, adding to their recent sharp gains. Agrium jumped C$4.39, or 5 percent, to C$92.70, and Potash Corp rose C$5.40, or 2.6 percent, to C$211.10.

But the broader materials sector edged up just 0.02 percent as shares of gold producers slid 1.8 percent. Agnico-Eagle Mines (AEM.TO) was down C$1.76, or 2.4 percent, at C$70.71, and Kinross Gold (K.TO) gave up 98 Canadian cents, or 4.1 percent, to C$22.87.

Eldorado Gold Corp (ELD.TO) slipped 22 Canadian cents, or 3 percent, to C$7.16 after Frontier Pacific Mining Corp FRP.V rejected its C$148.2 million takeover bid, saying the offer was inadequate.

Frontier Pacific closed up 19 Canadian cents, or 27.1 percent, at 89 Canadian cents on the TSX Venture Exchange.

Loblaw (L.TO) weighed to the downside, shedding C$1.96, or 6.2 percent, to C$29.77, after Canada’s biggest grocer shuffled its executive suite, as it announced its president and chief financial officer were leaving.

Shares of George Weston WN.TO, which controls Loblaw, were down C$2.41, or 4.9 percent, at C$47.30. The consumer staples sector was down 2.1 percent.

Timminco’s TIM.TO shares lost 80 Canadian cents, or 3.5 percent, to C$22.15 after a report in Barron’s questioned the specialty metals producer’s low-cost method of purifying silicon for solar cells.

Angiotech Pharmaceuticals ANP.TO slid 35 Canadian cents, or 11.9 percent, to C$2.60 after the maker of medical devices said it had suspended U.S. and European trials for its vascular wraps until a safety review has been done.

Investors will be watching for the interest rate decision from the Bank of Canada on Tuesday. Douglas Davis, president at Davis-Rea, said he thinks a half-point rate cut has been priced into the market.

Market volume was 334 million shares worth C$6.7 billion. Decliners outpaced advancers 833 to 771. The blue chip S&P/TSX 60 index .TSE60 closed up 7.39 points, or 0.88 percent, at 849.92.

In New York, stocks were weak amid soft results from Bank of America Corp (BAC.N), while worries over the impact of credit woes offset rising energy shares. The Dow Jones industrial average .DJI was down 24.34 points, or 0.19 percent, at 12,825.02, while the Nasdaq Composite Index .IXIC eked out a gain of 5.07 points, or 0.21 percent, to 2,408.04.

$1=$1.01 Canadian Editing by Peter Galloway

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