September 15, 2011 / 2:48 PM / 7 years ago

CANADA STOCKS-TSX rallies on central banks' EU move

   * TSX up 72.66 points, or 0.6 pct, at 12,346.04
 * Financials lead rally, energy sector also gains
 * Gold issues drag materials down 1.3 pct  (Updates with details, commentary)
 By Claire Sibonney
 TORONTO, Sept 15 (Reuters) - Toronto’s main stock index pushed higher on Thursday morning, lifted by a co-ordinated move by central banks to boost liquidity in the strained European banking sector.
 The European Central Bank said it would reintroduce three-month U.S. dollar liquidity tenders in the fourth quarter alongside other major central banks, including the U.S. Federal Reserve. [ID:nL5E7KF2LG]
 Recently, euro zone banks have experienced renewed stress in finding U.S. dollar funding as distrust between banks has grown due to the sovereign debt crisis.
 Toronto’s heavyweight financial sector, which has recently traded in sympathy with battered European banks, led the rally, rising 1.8 percent.
 Royal Bank of Canada (RY.TO) jumped 2.6 percent to C$47.21, Toronto-Dominion Bank (TD.TO) rose 1.9 percent to C$74.73 and Manulife Financial (MFC.TO) surged 5 percent to C$12.76.
 John Ing, president of Maison Placements Canada, said the co-ordinated central bank response to the euro zone problems was buoying markets, but warned that investors were still taking the positive headlines cautiously.
 “We have seen the cavalry come over the hill numerous times, with hopes being dashed with the reality that rhetoric does not match the action,” he said.
  At 10:24 a.m. (1424 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was up 72.66 points, or 0.6 percent, at 12,346.04. Eight of the 10 main sectors were firmer.
 Energy shares were 1.2 percent higher as oil prices climbed. Canadian Natural Resources (CNQ.TO) rose 1.3 percent to C$34.89 and Cenovus Energy (CVE.TO) advanced 2.9 percent to C$33.99. [O/R]
 Materials fell 1.3 percent, dragged down by retreating precious metal miners as  gold prices slipped below $1,800 an ounce. [GOL/] [ID:nL5E7KF1A4]
 Goldcorp Inc (G.TO) dropped 1.7 percent to C$49.50 and Barrick eased 0.8 percent to C$51.77.
 In individual company news, retailer Dollarama Inc (DOL.TO) gained 2.3 percent to C$35.05 after Canada’s largest operator of dollar stores reported a 79 percent rise in second-quarter profit. [ID:nL3E7KE4G9]
  ($1=$0.99 Canadian)  (Reporting by Claire Sibonney; editing by Rob Wilson)                 

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