Energy shares help Toronto market to relief rally
Reuters
Published Mar 20, 2023 22:50
Updated Mar 21, 2023 08:10
By Fergal Smith
(Reuters) - Canada's main stock index rose on Monday, helped by gains for resource and financial shares, as some calm returned to global financial markets after the turmoil in the banking sector.
The Toronto Stock Exchange's S&P/TSX composite index ended up 131.71 points, or 0.7%, at 19,519.43.
U.S. stocks were also higher on hopes that UBS Group AG (SIX:UBSG)'s takeover of Credit Suisse (SIX:CSGN) Group AG will avert a wider banking crisis and as investors weighed the likelihood of a pause in interest rate hikes from the Federal Reserve this week.
"The resolution to the Credit Suisse challenges over the weekend ... That has helped to set a calm over equity markets," said Philip Petursson, chief investment strategist at IG Wealth Management.
"There is little bit more of an optimistic attitude to equities just on a relief rally ... following a very hellish week that we had last week."
The TSX was down nearly 2% last week after losing 3.9% the week before.
The financial sector, which accounts for nearly 30% of the TSX's weighting, added 0.5% on Monday, while energy was up 2.9% as oil rebounded from a 15-month low. U.S. crude oil futures settled 1.4% higher at $67.64 a barrel. [O/R]
Canada's top six lenders have ample liquidity and manageable credit risks which will help them to emerge largely unscathed from the crisis of confidence that has rocked global banks over the last two weeks, analysts said.
Finance Minister Chrystia Freeland said Canadian financial institutions had the capital needed to weather periods of turbulence and that Ottawa was closely monitoring the global financial industry.
The materials sector, which includes precious and base metals miners and fertilizer companies, gained 0.8%.
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Written By: Reuters
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