TORONTO: Canadian stocks were higher in volatile trade on Tuesday as gains from gold miners and a windfall deal for Bombardier Inc offset concerns about Europe's lingering debt crisis.
Eight of Canada's 10 main sectors were higher. The heavily-weighted materials group led gains, climbing 1.4 percent as gold mining shares rebounded from Monday's selloff.
Leading the charge was Barrick Gold, up 0.9 percent to C$39.94, Goldcorp Inc, which rose 1.3 percent to C$40.44, Eldorado Gold Corp, rising 3 percent to C$12.36, Kinross Gold, up 1.5 percent at C$8.61, and Yamana Gold, which climbed 1.78 percent to C$16.50.
A mega jet deal involving Bombardier Inc also helped keep Canadian stocks in positive territory. Bombardier shares jumped 6.6 percent to C$3.89 on Tuesday after news that the Canadian planemaker had won a $7.3 billion aircraft order with NetJets, a private jet-sharing company owned by Warren Buffett's Berkshire Hathaway Inc.
"Their business jet business was decent and this is just a cherry on top," said Paul Hand, managing director at RBC Capital Markets. "It's the commercial project that is the big question mark and has been the drag on the company."
At 11:16 a.m. (1516 GMT), the Toronto Stock Exchange's S&P/TSX composite index was up 79.38 points, or 0.7 percent, at 11,481.16. It briefly dipped into negative territory, hitting a session low at 11,385.50.
"It's not a ringing endorsement of anything," said Hand on the Tuesday's TSX performance, adding gains were likely to be fleeting in the face of deteriorating conditions in Europe. "It's just the litany of so many problems that it's created an increased level of caution."
Markets were shaky on Tuesday after Spain's 100 billion euro ($125.11 billion) bank rescue failed to calm investors, who remained concerned bailout-related payments could rank ahead of regular government debt in the queue for repayment.
Spanish government bond yields were at their highest since the euro was launched in 1999 on concern over how difficult it may be for Madrid to access debt markets in the longer term.
Raising the stakes in Europe's debt crisis, Austria's finance minister said Italy, the euro zone's third economy, may need a financial rescue because of its high borrowing costs.
Despite the European headwinds, the Canadian financial index edged up 0.7 percent. Gains were led by top insurers Manulife Financial, which rose 2.3 percent to C$10.93, and Sunlife Financial, up 1.9 percent at C$21.74.
In other company news, shares of Agrium Inc rose 2 percent to C$82.99 after the Canadian fertilizer maker and farm products retailer said on Tuesday it expects its second-quarter earnings to be at or near the top of its forecast range due to higher prices for some of its wholesale fertilizer products.
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