CANADA STOCKS-TSX rallies as optimism for Europe, U.S. grows

Thu Oct 6, 2011 4:36pm EDT

 *TSX ends up 322.85 points, or 2.82 pct, at 11,780.07
 *All 10 sectors up sharply, materials gain 4.3 pct
 *Ivanhoe jumps 13 pct on Mongolia project go-ahead
 *Global sentiment rises on ECB and BoE moves
 *U.S. jobless claims up less than expected
 *Focus on U.S. jobs data Friday
 (Updates to close)
 By Claire Sibonney and Ashleigh Patterson
 TORONTO, Oct 6 (Reuters) - Toronto's main stock index rose
sharply for a second day on Thursday, marking its biggest gain
in nearly two months, as investors were encouraged by strength
in U.S. economic data and signs that European officials were
tackling the euro zone debt crisis.
 All 10 index sectors were stronger, with powerhouse
financials up 2 percent, energy up 3.6 percent and materials
4.3 percent higher.
 Among the most heavily weighted advancers, Suncor Energy
(SU.TO) jumped 4.3 percent to C$28.69, Royal Bank of Canada
(RY.TO) rose 2.8 percent to C$47.96, and Potash Corp (POT.TO)
added 3.9 percent to C$48.36.
 "The market is trading on a much firmer footing on hopes
European policy players are merging toward bank
recapitalization," said Fergal Smith, managing market
strategist at Action Economics.
  The European Central Bank threw another lifeline to
struggling European banks through the purchase of covered bonds
and with a renewed offer of longer-term loans to ward off a new
credit crunch. [ID:nL5E7L616W]
 Also boosting sentiment, the Bank of England launched a
second round of quantitative easing to defend Britain's
faltering economy against the euro zone debt crisis.
[ID:nL5E7L627B]
 The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE closed up 322.85 points, or 2.82 percent, at
11,780.07.
 "The bounce this week has helped improve the technical
backdrop as well," Smith said. Earlier in the week, the TSX hit
a 23-month low.
 Among the top gainers, Canadian miner Ivanhoe Mines
(IVN.TO) surged 13.1 percent to C$17.57 on news that its
massive copper-gold project in Mongolia will go ahead without
giving the Mongolian government a bigger stake.
[ID:nL3E7L622F]
 On the data front, new U.S. claims for unemployment
benefits rose slightly less than expected last week, hinting at
an improved labor market a day before closely watched Canadian
and U.S. employment data for September on Friday.
[ID:nN1E7950B8]
 "Some of the data we've seen over the past few days haven't
really been that bad ... so not really as dire as the action
we've seen in equity markets over the last few weeks," said
Robert Kavcic, economist at BMO Capital Markets.
 "There's a little bit of relief, some of the numbers have
been holding in OK. Tomorrow is obviously the big one the
market is waiting for, the U.S. jobs report."
 ($1=$0.04 Canadian)
















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