September 14, 2011 / 8:59 PM / 7 years ago

CANADA STOCKS-TSX gains on euro zone relief, golds drag

 * TSX rises 87.90 points, or 0.72 percent, at 12,293.38
 * Nine of 10 main sectors higher
 * Energy stocks lead gains; golds drag  (Updates to close. Adds details, commentary)
 By Trish Nixon
 TORONTO, Sept 14 (Reuters) - Toronto’s main stock index rose along with global equities on Wednesday, as European leaders displayed new urgency in efforts to contain the euro zone debt crisis.
 Comments from Europe’s top bureaucrat that plans for a common euro zone bond, seen by many as a key tool to ease the region’s debt crisis, would soon be presented helped restore investor appetite for risk and gave an early boost to equity markets. [MKTS/GLOB]
 Adding to relief, Italian Prime Minister Silvio Berlusconi won a confidence vote on an austerity plan for the euro zone’s third-largest economy, and German and French leaders urged Greece to implement all financial reforms “strictly and effectively” to ensure continued euro zone assistance and reduce any chance of a debt default. [ID:nP6E7JV05E]
 “It appears that the confidence pendulum has swung in the favor of European contagion not spreading, therefore world growth not being threatened, therefore more confidence in second half of 2011 growth,” said Robert McWhirter, a portfolio manager at Selective Asset Management Inc.
 Shares of oil and gas companies, which have been hit hard during recent downturns, gained 2.07 percent to lead Toronto’s rally.
 Suncor Energy (SU.TO) was the most influential advancer, adding 3.1 percent to C$29.44, while Cenovus Energy (CVE.TO) rose 3.5 percent to C$33.02 and Canadian Natural Resources (CNQ.TO) gained 2.2 percent to C$34.45.
 The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed the session up 87.90 points, or 0.72 percent, at 12,293.38. Nine of the 10 main index sectors gained.
 Gold mining stocks dragged the broader materials sector down 0.4 percent as the price of gold fell, causing the TSX to lag U.S. markets. [GOL/]
 “(Gold stocks) fit in well to the short term rotational volatility,” said Michael Smedley, chief portfolio manager at Morgan Meighen & Associates.
 “Nevertheless, the longer view is still of a strong gold price ... It’s going to continue to be a sector of interest.”
 Goldcorp (G.TO) was the heaviest drag on the index, falling 1.8 percent to C$50.37, while Barrick Gold (ABX.TO) lost 1.1 percent to C$52.16.  (Editing by Jeffrey Hodgson)                 

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