CANADA STOCKS-China reforms, Fed hopes lift TSX to two-year high
* TSX rises 20.90 points, or 0.16 percent, to 13,503.47 * Seven of the 10 main index sectors advance * Energy, material shares drop with commodity prices By John Tilak TORONTO, Nov 18 (Reuters) - Canada's main stock index climbed to a two-year high on Monday as China's plans to execute a new reform agenda and hopes that the U.S. Federal Reserve will stick with its easy monetary policy boosted market sentiment. Weakness in gold and oil prices weighed on material and energy stocks, however, overshadowing a rise in the financial sector and limiting the market's gains. With no major news hitting investors' screens over the weekend, the focus remained on Fed Vice Chair Janet Yellen's comments last week that she would support continuation of the U.S. central bank's stimulus program. Yellen has been nominated to be the Fed's next chief. "We're basically just picking up the trends from last week, with people reacting to Yellen's confirmation hearing, suggesting that she's going to keep quantitative easing going for a while," said Colin Cieszynski, senior market analyst at CMC Markets Canada. "The stock markets are being moved on the capital flowing in from QE programs, and this time that money hasn't found its way into commodities in the same way." Canada's benchmark index was also riding a wave of world stock market rises on Monday after the Chinese Communist Party unwrapped surprisingly bold reforms late last week, pledging to let the market play a "decisive" role in the economy. The Toronto Stock Exchange's S&P/TSX composite index was up 20.90 points, or 0.16 percent, at 13,503.47, after touching 13,504.41, its highest level since July 2011. "Over the longer term the trend for the TSX remains positive, but until commodities get going it still may have trouble catching up to its peers," Cieszynski said. The TSX, despite gains in the last several weeks, is trailing the rise of U.S. stock indexes this year. Seven of the 10 main sectors on the index were higher on Monday. Financial shares advanced 0.3 percent, with Toronto-Dominion Bank adding 0.2 percent to C$97.52, and Bank of Nova Scotia rising 0.2 percent to C$65.79. But both of the index's natural resource groups slipped along with commodity prices, with the materials sector down 0.4 percent and energy stocks losing 0.1 percent. Miner Barrick Gold Corp gave back 1.1 percent to C$18.70, and competitor Goldcorp Inc declined 0.3 percent to C$25.32. In corporate news, Fairfax Financial Holdings Ltd will buy a majority stake in privately held Keg Restaurants Ltd, which owns more than 100 steakhouse restaurants. Keg Restaurants said the transaction will benefit The Keg Royalties Income Fund, which gained almost 4 percent to C$16.80. Fairfax shares fell 0.7 percent to C$424.89.
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