* TSX up 50.07 points, or 0.42 percent, at 11,861.52
* Index still on track for sharp fall this week
* Recession in Europe, China transition weigh
* Mining and financial stocks lead broad upsurge
By Alastair Sharp
TORONTO, Nov 16 Canada's benchmark stock index
jumped on Friday, led by resource and financial shares, after
U.S. politicians made conciliatory statements after holding
talks on avoiding the "fiscal cliff" that threatens to drive the
economy into recession.
The index had fallen in morning trade, weighed down by signs
of global economic weakness, but swung higher after U.S.
politicians vowed to find common ground on taxes and spending
that could help the world's largest economy avoid what could be
debilitating tax hikes and spending cuts.
"It shows you how low our expectations are right now that
you can get that kind of a rally just by coming up to a
microphone and saying 'hey, we all understand each other'," said
Mike Newton, portfolio manager at Macquarie Private Wealth.
"What could be exciting about it is, imagine the rally that
will occur when they come out with something very concrete."
At 1:18 p.m. (1818 GMT), the Toronto Stock Exchange's
S&P/TSX composite index was up 50.07 points, or 0.42
percent, at 11,861.52. It was still on track for its sharpest
weekly drop since May, however.
Earlier in the day, investors drove down shares in reaction
to signs that barriers to a robust global recovery remain,
especially data on Thursday showing Europe's debt crisis had
dragged the euro zone back into recession.
A lackluster U.S. earnings season and China's leadership
transition also weighed.
STRONG RALLY POTENTIAL
But Rick Hutcheon, president and chief operating officer at
RKH Investments, said valuations have become cheap and that it
would take little for the index to bounce higher in coming
"If there is any glimmer of good news the market has a very
strong rally potential," he said, speaking before the U.S.
legislators made their comments.
Major miner Barrick Gold Corp led the index's rise,
up 2 percent at C$33.96, while BCE Inc gained 1.6
percent to C$42.03 as it continues to work with acquisition
target Astral Media Inc to get a deal past regulators.
Astral rose 4.8 percent to C$44.27.
Royal Bank of Canada added 0.7 percent to C$55.44,
and miner Centerra Gold Inc jumped 12 percent to C$9.46.
Fertilizer company Potash Corp was the most heavily
weighted decliner, dropping 1 percent to C$37.29, while Niko
Resources Ltd skidded to a 52-week low, tumbling more
than 10 percent to C$8.33, after the oil company announced stock
and convertible debt offerings.