TORONTO: Toronto's main stock index posted its biggest gain in nearly a month on Monday as commodity prices rose on hopes that European leaders were readying a plan to resolve the region's debt crisis.
Rising oil, gold and copper prices helped the TSX rally more than 1.5 percent, after it sagged 4 percent last week.
The heavily weighted materials sector, up 2 percent, was buoyed by stronger gold and copper prices
Both hit one-week highs on hopes that a meeting among euro zone ministers on Tuesday would pave the way for a 440 billion euro bailout fund, guided by the European Financial Stability Facility.
Among the sector's leaders were First Quantum Minerals, up nearly 10 percent at C$18.62, and Barrick Gold, up 2.4 percent at C$51.18.
"You're getting some positive comments out of Europe that they're about to bring that big hammer down and get that solution in place," said Philip Petursson, managing director of the portfolio advisory group at Manulife Asset Management.
The Toronto Stock Exchange's S&P/TSX composite index ended up 178.15 points, or 1.55 percent, at 11,640.21. It was the index's best one-day gain since Nov. 3.
All 10 of the TSX's main main sectors were higher, led by oil and gas issues, which climbed 2.7 percent, as US crude oil spiked to nearly $100 a barrel.
Canadian Natural Resources led the sector's gains, jumping 3.7 percent to C$35.20. Suncor Energy was also among the biggest risers, up 2.7 percent to C$28.91.
"Equities have been so beaten up that any hope of something positive coming out of (Europe) looks like enough to get markets moving pretty significantly," said Robert Kavcic, an economist at BMO Capital Markets.
Canadian financial issues, which have less European sovereign debt assets than their global counterparts, responded to the market optimism with a gain of more than 1 percent.
Royal Bank of Canada led the sector's rise, adding 2.1 percent to C$44.32.
Additional hope for a euro zone resolution was seen as an Italian newspaper suggested the International Monetary Fund was preparing a rescue plan for Italy, although an IMF spokesperson denied the report.
While the rosier European outlook was a tonic for equities markets, which have been pummeled for much of the month, some skepticism remained.
"It's just noise," said John Ing, president of Maison Placements Canada. "The IMF perhaps stepping in so there are high hopes that we turn the corner, but it's a very long corner."
Canadian retail issues got a boost from strong US sales over the Thanksgiving holiday weekend.
The consumer discretionary sector edged up 0.1 percent. Canadian Tire Corp was among the top performers, rising 0.2 percent to C$63.11.
In individual company news, Cameco Corp rose 5 percent to C$18.23 after the uranium producer backed out of a bidding war with Rio Tinto for Hathor Exploration, whose shares fell 7 percent to C$4.69.
Canmarc REIT soared nearly 20 percent to C$15.80 after a hostile takeover bid by rival Cominar Real Estate Investment Trust that valued the diversified property manager at C$838 million.
Comments
Comments are closed for this article.