RTRS: Gold miners help drive TSX to one percent gain
By Trish Nixon
TORONTO (Reuters) - Toronto's main stock index rebounded on Tuesday, after touching a one-week low in the previous session, as bargain-hunters returned to the market and gold miners rose along with bullion prices.
The materials sector led the broad rally, up 2.3 percent, lifted by strength in gold issues. The price of bullion rose by more than 1 percent on safe-haven buying after a warning from the International Monetary Fund on slowing global growth put crude oil and base metals under pressure.
Goldcorp (G.TO) was the most influential advancer, up 4.2 percent at C$52.16, followed by Barrick Gold (ABX.TO), which rose 2.9 percent to C$54.36.
"The TSX is oversold," said David Baskin, portfolio manager and president of Baskin Financial Services.
"There's some real bargains out there, and I think if we see any positive signs from the Fed or from Europe you'll see a relief rally."
Investors were also hoping the Federal Reserve would offer fresh stimulus to a sputtering U.S. economy at a two-day policy meeting that started on Tuesday, with a move to stock up on longer-term Treasury notes.
Analysts expect Fed Chairman Ben Bernanke to muster a consensus behind a plan to rebalance the Fed's bond portfolio to push down longer-term interest rates.
At 10:53 a.m. (1453 GMT) The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was up 155.53 points, or 1.28 percent at 12,327.57. All 10 of its main groups were higher, as investors stepped back into the market after two days of losses.
The big banks and insurers added 1.1 percent, with Royal Bank of Canada (RY.TO) rising 1.2 percent to C$47.16, and Toronto-Dominion Bank (TD.TO) up 1 percent at C$74.29.
The market appeared to shrug off Standard & Poor's downgrade of Italy's credit rating by one notch, an unexpected move that increased strains on the already stressed euro zone, as well as data showing U.S. housing starts fell more than expected in August.
