CANADA STOCKS-TSX jumps on Summers exit from Fed race

Mon Sep 16, 2013 5:42pm EDT

* TSX rises 93.48 points, or 0.73 percent, to 12,816.88
    * All 10 main index sectors advance
    * TD, CIBC gain after Aeroplan deal

    By John Tilak
    TORONTO, Sept 16 (Reuters) - Canada's main stock index rose
on Monday after U.S. Treasury Secretary Lawrence Summers
withdrew from the race to become chairman of the Federal
Reserve. 
    Gains in every major sector took the index to its biggest
single-day percentage jump in more than two weeks, and advances
in the financial sector were the main drivers. 
    Investors bet that a gradual unwinding of the U.S. central
bank's stimulus measures was likely now with Summers out of the
race to replace Fed Chairman Ben Bernanke. 
    The news comes days before a crucial Fed meeting, which
investors expect will provide more clarity about U.S. monetary
policy direction. 
    "The assumption investors are making is that (Fed Vice
Chair) Janet Yellen is a moderate in terms of monetary policy,"
said Irwin Michael, portfolio manager at ABC Funds. "People are
looking at that favorably, that we'll get the same sort of
policy we've had with Bernanke."
    "She would provide continuity, and the market is factoring
that in," he added. 
    The Toronto Stock Exchange's S&P/TSX composite index
 closed up 93.48 points, or 0.73 percent, at 12,816.88,
its biggest single day percent jump since Aug. 29. 
    The benchmark Canadian index is up about 5 percent this
quarter after a sluggish first-half performance.
    Investors taking a longer-term view of the Canadian market
could reap some benefits by the end of the year, despite some
short-term volatility, said Fred Ketchen, director of equity
trading at ScotiaMcLeod.
    "My guess is cautious moves will still be made on the
upside," he said.
    Financials, the index's most heavily weighted sector, added
0.9 percent. 
    In the group, Royal Bank of Canada was up 0.9
percent at C$65.91, Toronto-Dominion Bank rose nearly 1
percent to C$90.79, and Canadian Imperial Bank of Commerce
 gained 0.8 percent to C$81.74.
    Aimia Inc, which runs the Aeroplan loyalty program,
struck a deal with TD and CIBC under which TD will be the issuer
of Aeroplan cards and buy half of CIBC's existing Aeroplan
portfolio, with CIBC retaining the rest. 
    Shares of Aimia jumped 7.3 percent to C$17.85. 
    The index's materials sector, which includes mining stocks,
gained 0.3 percent. Barrick Gold Corp advanced 2.2
percent to C$18.75, and Potash Corp was up 1.5 percent,
at C$34.06.
    Bombardier Inc's new CSeries jetliner took flight
on Monday for the first time. The stock slipped 0.6 percent to
C$4.96.
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