*TSX rises 28.89 points, or 0.25 percent, at 11,614.76
*Seven of 10 sectors rise; banks lead gains
By Trish Nixon
TORONTO, Sept 29 (Reuters) - Toronto’s main stock market index rose on Thursday morning, but was off early highs, as optimism about the global economy picked up after the release of positive U.S. data and a vote in the German parliament to approve a stronger euro zone bailout fund.
But the TSX index retreated from an early jump of 1.5 percent to a high of 11,754.62 as markets reflected on the big challenges still ahead for the euro zone amid demands for more far-reaching measures to prevent a crisis that began in Greece from spreading far beyond Europe and its banks. [ID:nL5E7KT2WC]
“The market has pretty well been trading up and down with the sentiment coming out of Europe the past few days,” said Robert Kavcic, economist at BMO Capital Markets.
“(The German vote) is certainly a step in the right direction, but I wouldn’t be surprise if we continue to get more volatility.”
At 11:06 a.m. (1506 GMT) the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was up 28.89 points, or 0.25 percent, at 11,614.76, with seven of its 10 sectors higher.
Data from south of the border also provided a boost. Jobless claims fell more than expected last week in the United States, and revised data showed second-quarter economic growth was stronger than had been expected. [nS1E78R0SH] [nS1E78S0BT]
Banks and insurers, up 1.2 percent, drove the TSX’s gains. Royal Bank of Canada (RY.TO) was the heaviest advancer, rising 1.2 percent to C$48.12, followed by Manulife Financial (MFC.TO), up 3.1 percent at C$12.08, and Toronto-Dominion Bank (TD.TO), which rose 1 percent to C$74.30.
Energy issues rose 0.3 percent, lifted by oil prices that rose more than $1 a barrel. Cenovus Energy was up 1.4 percent at C$32.58, while Suncor Energy added 0.9 percent to C$27.29. [O/R]
The index’s materials sector sank 0.9 percent, pressured by base-metal miners as copper prices slipped. Potash Corp POT.TO was the heaviest decliner, down 1 percent at C$46.52, while Silver Wheaton SLW.TO lost 3.2 percent to C$30.64 and Ivanhoe Mines (IVN.TO) fell 4.9 percent to C$15.29. [MET/L]
($1=$1.03 Canadian) (Reporting by Trish Nixon; editing by Peter Galloway)