August 27, 2010 / 4:37 PM / 8 years ago

CANADA STOCKS-TSX rises sharply as Bernanke comments soothe

* TSX up 185.74 points, or 1.59 percent, at 11,838.92

* Fed to provide more monetary accommodation if needed

* All of TSX main sectors higher (Updates to midday, adds quote)

By Jennifer Kwan

TORONTO, Aug 27 (Reuters) - Toronto’s main stock index rose sharply on Friday, led by gains in resource and financial issues, after Federal Reserve Chairman Ben Bernanke said the U.S. central bank was ready to take further steps to aid the recovery.

Bernanke said on Friday the recovery has softened more than expected and the Fed is ready to take further steps if needed to spur the stumbling U.S. economy. [ID:nN27259859]

The comments sent the broader TSX index sharply higher, led by its three main sectors: energy, financials and materials. The resource-laden market was also supported by strong oil, gold and base metal prices. [O/R] [GOL/] [METL/]

Suncor Energy (SU.TO) rose 1.6 percent to C$32.67 and Royal Bank of Canada (RY.TO) climbed 2.5 percent to C$50.16. Goldcorp (G.TO) was up 1.4 percent at C$46.49 and Teck Resources TCKb.TO was higher by 3.1 percent at C$34.60.

The big issue that has been weighing on markets recently has been the idea that the U.S. economy will grow very slowly, or even see a double-dip recession, said Julie Brough, vice-president at Morgan Meighen & Associates.

“The fact that he’s basically putting out there that they will keep priming the pump as long as they need to, and as aggressively as they need to, takes away some of those fears of a double dip or a very slow period economically,” she said.

At 12:16 a.m. (1616 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was up 185.74 points, or 1.59 percent, at 11,838.92, with all of its 10 main sectors higher.

Even before Bernanke’s comments, the TSX had risen on revised quarterly growth figures that showed the U.S. economy was performing better than anticipated. [ID:nN26193565]

In individual company news, Potash Corp POT.TO gained 1.4 percent to C$155.51 after falling for three days as investors continued to watch closely for developments around BHP Billiton’s $39 billion takeover offer.

BHP’s chief executive is expected to fly to North America this week to mount a charm offensive to woo Potash shareholders, as a potential Chinese rival reiterated it was closely watching developments. [ID:nN26228720]

Research In Motion RIM.TO, down 1.8 percent at C$48.76, also remained in the spotlight. India may extend an Aug. 31 deadline in its standoff with the BlackBerry maker over access to encrypted data, if RIM says it has a solution and asks for time, a government source said on Friday. [ID:nLDE67Q1B5] [ID:nN26274695]

$1=$1.05 Canadian Reporting by Jennifer Kwan; editing by Rob Wilson

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