CANADA STOCKS-Fed commentary drives broad TSX gains

Wed May 21, 2014 4:47pm EDT

* TSX rises 124.67 points, or 0.86 percent, at 14,649.86
    * All 10 main index sectors advance
    * Sears Canada slips after reporting results

    By John Tilak
    TORONTO, May 21 (Reuters) - Canada's main stock index
climbed on Wednesday after comments from the Federal Reserve
assured investors of the central bank's commitment to gradually
withdraw support to the U.S. economy and helped drive gains
across all major sectors.
    Fed policymakers last month began to lay groundwork for an
eventual retreat from their extraordinarily easy monetary policy
with a discussion of the tools they could employ to accomplish
the task, but they did not take any final decisions, minutes
from a recent policy meeting of the U.S. central bank showed.
 
    The Toronto stock market's benchmark index climbed for a
second straight session and is up about 7.5 percent this year.
    Investors appeared to be less jittery about Fed commentary
than they have been in the past, with both U.S. and Canadian
stock markets climbing after the minutes were released. 
    "Now we feel like we can get off (the stimulus) without too
much damage. That's very bullish," said Ken Lester, president
and portfolio manager at Lester Asset Management.
    Investors should brace for an eventual rise in interest
rates but they shouldn't completely shun bonds, he said.
    The Toronto Stock Exchange's S&P/TSX composite index
 closed up 124.67 points, or 0.86 percent, at
14,649.86.
    Lester expects the Canadian benchmark to end the year higher
from current levels.
    "The Canadian market is poised to do quite well," he said,
adding that it will benefit from the lower Canadian dollar and a
rebound in the natural resource sectors.
    All of the 10 main sectors on the index were higher on
Wednesday.
    Shares of energy companies advanced 1.5 percent, supported
by a gain in the price of oil. Canadian Natural Resources Ltd
 added 2.2 percent to C$44.29, and Enbridge Inc 
jumped 1.4 percent to C$52.81.
    Financials, the index's most heavily weighted sector, rose 1
percent. Royal Bank of Canada climbed 1.2 percent to
C$74.29, and Bank of Montreal was up 0.9 percent at
C$75.25.
    In corporate news, Sears Canada Inc posted a bigger
quarterly loss as a prolonged winter hurt sales. The stock
slipped 0.7 percent to C$15.21. 
    ($1=$1.09 Canadian)

 (Additional reporting by Leah Schnurr; Editing by Peter
Galloway and James Dalgleish)
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