CANADA STOCKS-Commodities, profit hopes push TSX to 2-week high

Fri Nov 23, 2012 4:36pm EST

* TSX ends up 60.14 points, or 0.49 percent, at 12,213.24
    * Touches highest level since Nov. 12
    * Eight of 10 sectors on benchmark index rise

    By Claire Sibonney
    TORONTO, Nov 23 (Reuters) - Canadian shares hit their
highest point in nearly two weeks in thin trading on Friday,
rallying for a sixth straight session on stronger commodity
prices and on earnings expectations for financial stocks.
    Financial shares also advanced for a sixth day ahead of the
quarterly reporting season for Canadian banks.  
    Bank results will be released over the next two weeks, with
Royal Bank of Canada the first to report, on Nov. 29.
Analysts expect the country's six big banks to report profit
gains in the area of 10 percent year-over-year. 
    Among the top advancers on Friday, Toronto-Dominion Bank
 rose 0.5 percent to C$81.40, and Bank of Montreal
 gained 0.7 percent to C$58.95. Royal Bank edged up 0.2
percent to C$57.95.
    The Canadian banks have mostly outperformed the broader
market over the past month, helped by optimism that their
consumer lending and trading businesses will churn out strong
profits despite concerns about a housing slowdown and turmoil on
international markets. 
    "Part of that is going to be fundamentals-based but it's
partly going to be also based on the sentiment of
risk-on/risk-off," said Bill Horton, chief investment officer at
MD Physician Services.
    Resource companies were also broadly stronger as commodity
prices rose. 
    Talisman Energy climbed 3.8 percent to C$11.68,
Barrick Gold gained 1.3 percent to C$35.19, and
Canadian Natural Resources advanced 1.1 percent to
C$27.94.
    The Toronto Stock Exchange's S&P/TSX composite index
 ended up 60.14 points, or 0.49 percent, at 12,213.24.
Eight of its 10 main sectors were up. Earlier, the index touched
12,229.77, its highest level since Nov. 12. The TSX ended the
week almost 3 percent stronger.
    Optimism about a deal to help Greece, hopes that U.S.
lawmakers can agree on a solution to avoid a fiscal crisis, and
data showing an improving global economic outlook have driven a
rally in riskier asset markets this week.
    "Our base scenario is similar to what the Bank of Canada is
espousing and that is we're looking at a relative containment of
the problems in the euro zone and a relative containment of the
potential fallout from a U.S. fiscal cliff," Horton said. 
    Greece said on Friday the International Monetary Fund had
relaxed its debt-cutting target for the country, suggesting
lenders were closer to a deal for a vital aid tranche to be
paid. But other sources involved in the talks cautioned the
funding gap was far bigger than Greece suggested.
 
    Separately, European Central Bank President Mario Draghi
said confidence was returning to the euro zone, and governments
must implement reforms to secure the bloc's future.
 
    With U.S. trading ending early at 1:00 p.m.(1800 GMT) on
Friday, volume on both sides of the border was light. About 191
million shares changed hands on the Toronto Stock Exchange,
compared with a daily average of 281.9 million in October.
    "I don't think minds are in the market, especially here in
Toronto with the Grey Cup (Canadian Football League
championship), shopping, Black Friday, you name it ... nobody's
around," said Sal Masionis, stockbroker at Brant Securities.
    "Monday will be getting back to reality."
    On the downside, Research In Motion was one of the
biggest drags after a stunning gain the previous session. After
surging 17 percent on Thursday on the back of optimism about the
prospects for the company's soon-to-be-launched BlackBerry 10
smartphones, RIM shares were down 3.3 percent at C$11.61.
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