July 22, 2009 / 4:55 PM / 10 years ago

CANADA STOCKS-TSX turns higher, boosted by financials

* TSX up 0.1 percent at 10,524.52

* Financial group up 1.03 percent

* Energy sector off 0.5 percent on lower oil prices (Adds details, quotes)

By Nina Lex

TORONTO, July 22 (Reuters) - Toronto’s main stock index was slightly higher early on Wednesday afternoon, as healthy gains by financial issues were largely offset by retreating energy and materials shares.

The financial sector, which accounts for about a third of the TSX index, was up 1.03 percent, encouraged by strong domestic retail sales and better than expected U.S. corporate earnings.

Royal Bank of Canada (RY.TO) was ahead 0.85 percent at C$49.88, Toronto-Dominion (TD.TO) rose 1.29 percent to C$60.58 and Bank of Nova Scotia (BNS.TO) was up 0.37 percent at C$43.16.

“As you look to the States, for the most part earnings are coming in positive relative to expectations,” said Bob Gorman, chief portfolio strategist at TD Waterhouse.

However, the heavyweight energy sector was down 0.5 percent as the price of oil dropped to around $65 a barrel. Suncor Energy (SU.TO) fell 0.47 percent to C$36.02, while Petro-Canada PCA.TO was down 0.26 percent at C$46.03.

Suncor, which is taking over Petro-Canada to become the country’s largest oil company, reported a second-quarter loss on Wednesday, hit by low oil and gas prices. [ID:nLM164814]

At 12:25 a.m. (1618 GMT), the S&P/TSX composite index .GSPTSE was up 10.45 points, or 0.1 percent, at 10,524.52 after dropping as much as 111 points earlier in the day. Eight of its 10 main groups were lower.

“Markets are trading in a very narrow range today. You really don’t have an awful lot of net move in the market,” said Gorman.

“I would say expectations were ratcheted up. That’s why you really aren’t seeing things move in response to earnings announcements for the most part.”

The mining-laden materials sector was down 0.3 percent. The biggest drag on the index was Potash Corp POT.TO, down 2.7 percent at C$97.82, as the outlook for global fertilizer prices tumbled.

German company K+S SDFG.DE became the latest potash supplier to sign a $460 per tonne supply deal with India for the crop nutrient, cementing a slump in prices that has weighed on global potash companies’ shares. [ID:nLM297548]

$1=$1.10 Canadian Reporting by Nina Lex; editing by Rob Wilson

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