October 23, 2008 / 9:49 PM / 10 years ago

CANADA STOCKS-Market gets lift from rising oil

* Energy stocks get lift as oil firms above $67

* Materials group down 3.2 percent as metal prices slide

* Petro-Canada stock rises ON quarterly results (Adds analyst quotes, details)

By Jennifer Kwan

TORONTO, Oct 23 (Reuters) - The Toronto Stock Exchange’s main index closed nearly 100 points higher in a volatile session on Thursday as energy issues got a boost from a higher crude price and strong earnings from major companies in the oil and gas sector.

The heavily weighted energy group led the benchmark index higher, rising 3.5 percent as oil rose on expectations of an OPEC supply cut [ID:nSYD377354].

Strong earnings from Petro-Canada PCA.TO [ID:nN23293318] and EnCana (ECA.TO) [ID:nBNG274906] also helped boost the sector.

Investors are eagerly awaiting any announcement by OPEC on production cuts, aimed at firming crude prices, given the rapid slide in oil prices from record levels above $147 a barrel on fears of a global recession and plunging demand.

“The main reason is the OPEC meeting tomorrow and there are rumors floating around on what the size of the cutback will be by OPEC,” said Sal Masionis, a stockbroker at Brant Securities.

“The more they cut the higher the oil prices will go.”

The big financial services group finished the day up 1.9 percent after falling earlier in the session alongside its global peers on concerns about loan losses, tight credit and deteriorating economies [ID:nLN557430].

After a seesaw session that saw the TSX swing nearly 580 points from trough to peak, the S&P/TSX composite index .GSPTSE closed up 94.47 points, or 1.02 percent, at 9,331.35, with seven of its main sectors higher.

A late buying spree by bargain-hunters also helped lift the market, which had been under pressure from recessionary concerns, said Fred Ketchen, director of equity trading at ScotiaMcLeod.

The TSX opened strongly but soon gave up those early gains as market focus turned from corporate results to anxiety about company forecasts as recession fears heightened. [ID:nN23445110]

“We’ve got mixed messages and nobody knows which message to hang their hat on, or determine what to believe,” said Ketchen.

Investors are also eyeing corporate outlooks from both sides of the border, said Paul Taylor, chief investment officer at BMO Harris Investment Management Inc.

“It’s all about guidance at this point in time,” he said.

In the oil patch, Petro-Canada rose 9.4 percent to C$27.80, and EnCana was up 8.5 percent at C$55.05.

The resource-laden materials group weighed on the index, falling 3.2 percent as gold and base metals prices dropped on recession fears. [ID:nN23450334]

Teck Cominco TCKb.TO sank 12.4 percent to C$12.54 after the miner said it plans to reduce its exploration budget and is considering asset sales to quickly pay down debt. [ID:nN23411992]

Market volume was 559.3 million shares worth C$7.84 billion. Decliners outpaced advancers 1,064 to 491. The blue chip S&P/TSX 60 index .TSE60 closed 7.72 points higher, or 1.3 percent, at 562.52.

On Wall Street, stocks fought back from five-year lows on a bounce in energy and health-care issues.

The Dow Jones industrial average .DJI rose 172.04 points, or 2.02 percent, at 8,691.25. The tech-heavy Nasdaq composite index .IXIC ended down 11.84 points, or 0.73 percent, at 1,603.91. ($1=$1.25 Canadian) (Reporting by Jennifer Kwan; editing by Rob Wilson)

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