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CANADA STOCKS-TSX rises as Fed talk boosts banks
March 1, 2017 / 4:25 PM / 9 months ago

CANADA STOCKS-TSX rises as Fed talk boosts banks

(Adds details on specific stocks, updates prices)

* TSX up 134.77 points, or 0.88 percent, to 15,534.01

* Nine of the TSX’s 10 main groups move higher

TORONTO, Feb 23 (Reuters) - Canada’s main stock index bounced higher on Wednesday as its heavyweight financial services group cheered signs from U.S. Federal Reserve policymakers that raised expectations for a March rate hike.

Resource stocks, industrials and consumer names were all also broadly higher in morning trade, as advancers outnumbered decliners three-to-one and the index looked set to break a five-day downward move.

New York Fed President William Dudley, one of the most influential U.S. central bankers, said the case for tightening monetary policy had become “a lot more compelling”, while San Francisco Fed President John Williams said he saw “no need to delay” raising rates.

Canadian financial stocks stand to benefit from any hikes as higher bond yields reduce the value of insurance companies’ liabilities and increase net interest margins of banks.

The group gained 1.1 percent overall, with insurer Manulife Financial Corp up 2 percent to C$24.21 and Toronto-Dominion Bank advancing 0.9 percent to C$69.08. TD reports quarterly results on Thursday.

National Bank of Canada gained 2.3 percent to C$57.97 after reporting profit that handily beat estimates.

By contrast to the Fed, the Bank of Canada held rates steady on Wednesday as it stayed focused on the “significant uncertainties” facing the domestic economy.

At 11:00 a.m. ET (1600 GMT), the Toronto Stock Exchange’s S&P/TSX composite index was up 134.77 points, or 0.88 percent, to 15,534.01.

Nine of the index’s 10 main groups were in positive territory, with only telecoms lagging.

The energy group climbed 0.9 percent, as oil prices rose as investors took heart from strict OPEC compliance with its pledge to cut output.

Industrials rose 1.4 percent, while the materials group, which includes precious and base metals miners and fertilizer companies, added 0.7 percent. First Quantum Minerals Ltd jumped 6 percent to C$14.65 and Teck Resources Ltd advanced 5.5 percent to C$28.02 as copper prices hit a more than one-week high.

Meanwhile gold miners pulled back with gold after the Fed comments and as a Tuesday night speech by U.S. President Donald Trump included little detail on his plans for tax reform and infrastructure spending.

Goldcorp Inc fell 1.7 percent to C$20.69 and Kinross Gold Corp lost 2 percent to C$4.59.

Reporting by Alastair Sharp; Editing by Chizu Nomiyama

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