July 23, 2010 / 9:15 PM / 9 years ago

CANADA STOCKS-TSX ends higher on earnings, data, copper

* Materials, industrials, bank shares all higher

* CN profit outlook boosts sentiment

(Updates to close)

By Cameron French

TORONTO, July 23 (Reuters) - Toronto’s main stock index ended a choppy session higher on Friday, capping off a strong week on the back of positive economic signals and a batch of solid North American earnings.

Copper rallied to a two-month high, helping drive Canadian mining issues higher, while a strong profit forecast at Canadian National Railway (CNR.TO) strengthened confidence that second-quarter earnings period would be a boon to investors’ confidence.

“There was a lot (of gains) on the back of CN having a fairly good number and raising their profit out for the year, a signal the economy might be in a little better shape,” said Michael Sprung, president of Sprung & Co. Investment Counsel.

The news bumped CN shares up 2 percent to C$64.98, and helped drive the TSX industrial sector up 1.1 percent, the strongest of the 10 TSX subgroups. Overall eight subgroups were higher.

The investor mood also benefited from a new round of solid U.S. corporate results, including Verizon Communications Inc. (VZ.N), and a dividend hike by General Electric Co. (GE.N).

Strong U.S. earnings helped the Dow Jones industrial average power to triple-digit gains on Thursday, allowing the TSX main index to finish the week with a 1.2 percent five-day gain.

Sprung said corporate earnings will continue to be the focus going forward, as more Canadian companies report over the next few weeks.

All told, the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended the session up 46.45 points, or 0.4 percent, at 11,714.63.

The strong copper price was boosted by fund buying amid economic optimism, helping push the TSX materials sector up 0.5 percent, despite slightly weaker gold prices.

Sherritt International (S.TO), a Cuba-focused base metals miner, rose 5.3 percent to C$6.93, while diversified miner Teck Resources TCKb.TO gained 1.6 percent to C$37.

“China is now taking more of a growth stance over an inflation concern stance right now,” said Rick Meslin, head of Canadian equities at UBS Securities Canada.

“That’s a constructive market as far as I’m concerned, especially in Canada, where materials are such an emphasis.”

Heavily-weighted financial shares gained 0.4 percent as Canadian Imperial Bank of Commerce (CM.TO) added 1.7 percent to C$68.40 and Bank of Montreal (BMO.TO) rose 1.2 percent to C$61.78.

On the economic side, Statistics Canada said moderating energy prices helped slow Canada’s annual inflation rate in June from May, suggesting the central bank has breathing room to take a gradual approach to future interest rate hikes.

$1=$1.04 Canadian Reporting by Cameron French, additional reporting by Claire Sibonney; Editing by Jeffrey Hodgson

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