April 8, 2009 / 3:56 PM / 10 years ago

TSX rides energy shares to 1.6 percent gain

TORONTO (Reuters) - Toronto’s main stock index rebounded from an early drop to end higher on Wednesday as rising oil prices gave a boost to energy shares, but nagging economic concerns held the gains in check.

A Toronto Stock Exchange (TSX) logo is seen in Toronto November 9, 2007. REUTERS/Mark Blinch

Energy shares had stumbled at the start of the session but turned higher as data from the U.S. Department of Energy showed crude stockpiles rose less than expected, which helped send oil prices back to around $50 a barrel.

Shares of Suncor Energy (SU.TO) rallied 4.5 percent to close at C$30.50, while Petro-Canada PCA.TO rose 5 percent to C$37.49. The energy group, which did the bulk of the lifting in the latest session, ended up 2.95 percent.

“The key reversal (in the TSX) came from the oil inventory data,” said Francis Campeau, a broker at MF Global Canada in Montreal. “That was the catalyst.”

The S&P/TSX composite index .GSPTSE rose 144.53 points, or 1.64 percent, to close at 8,969.28. Nine of the TSX’s 10 main sectors ended higher, with a 0.06 percent dip by the consumer staples group the only blemish.

The TSX ended at a session high, a big turnaround from the morning when it turned negative.

Another support behind the TSX’s turnaround came from the financials, which closed up 1.30 percent after the U.S. Treasury Department outlined the status of its plans to aid some life insurers.

Manulife Financial (MFC.TO) was up 1.9 percent at C$16.47, while Sun Life Financial (SLF.TO) jumped 5.2 percent to C$25.00, helping the financials index to a 0.66 percent gain.

“Obviously the insurance (news) in the United States helped the financials as a whole,” said Sal Masionis, a stockbroker at Brant Securities.

Masionis said gains in equities may have been muted a bit given the upcoming onslaught of corporate earnings due out of the United States, which many expect will be gloomy.

Activity during the week’s final session on Thursday could be influenced by early data that is expected to show Canada’s economy likely suffered its fifth straight month of heavy job losses in March.

But market watchers have noted that action on the index could trickle to a standstill during the latter half of Thursday’s session as the TSX will be closed on Friday for the Easter holidays.

($1=$1.24 Canadian)

Editing by Rob Wilson

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