August 31, 2010 / 3:07 PM / 8 years ago

CANADA STOCKS-TSX rallies on gold, looks past data

* TSX gains 0.46 percent to 11,950.31

* Golds climb as bullion prices hit two-month high

* Scotiabank lags peers after disappointing results

* Canadian economy slows sharply in second quarter (Adds details)

By Ka Yan Ng

TORONTO, Aug 31 (Reuters) - Toronto’s main stock index looked past some disappointing banking results and economic growth data and rose on Tuesday morning, lifted by strength in gold-mining issues as the price of gold hit a two-month high.

The price of gold, at $1,244.80 an ounce, shot to its highest level since late June after a regional survey for New York City showed business activity fell in August to its lowest level in a year. Data that showed U.S. consumer confidence was higher-than-expected in August didn’t do much damage to gold’s strength.

Goldcorp (G.TO) jumped 2.7 percent to C$47.65, while Barrick Gold (ABX.TO) added 1.6 percent to C$50. Fellow gold miner Kinross (K.TO) climbed 3 percent to C$17.73. The index materials group, which includes golds, was up 1.6 percent, while the global gold subgroup was up more than 2 percent.

At 10:40 a.m. (1440 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was up 54.76 points, or 0.46 percent, at 11,950.31, after opening lower. Seven of the index’s 10 main groups were higher.

Canada’s economic growth rate slowed more sharply than expected in the second quarter on lower consumer spending and a weaker trade performance, but the figures hurt the Canadian dollar rather than equity markets. [ID:nN31233897]

“It’s a mixed data day, but Canada seems to be defying gravity with the gold sector,” said Francis Campeau, broker at MF Global Canada, in Montreal.

“(Bank of Nova Scotia) was disappointing, GDP was disappointing, but the market is ignoring this info.”

Bank of Nova Scotia (BNS.TO), Canada’s third-largest bank, said quarterly profit rose 13.9 percent, slightly below expectations. The stock slipped 0.2 percent to C$51.82, lagging its peers, which rose. Toronto-Dominion Bank (TD.TO), for example, was up 0.89 percent at C$72.25.

Overall, the index’s financial group was up 0.3 percent.

$1=$1.07 Canadian Reporting by Ka Yan Ng; editing by Peter Galloway

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