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Toronto shares jump as Trudeau win lifts stimulus hopes

09/21/2021 | 09:59am

(Reuters) - Canada's main stock index rebounded on Tuesday as Prime Minister Justin Trudeau's victory in the federal election raised hopes that his government would keep the stimulus taps open, while higher oil prices lifted energy stocks.

At 9:37 a.m. ET (13:37 GMT), the Toronto Stock Exchange's S&P/TSX composite index was up 153.8 points, or 0.76%, at 20,308.34 -- on track for its best day in two months.

The index had closed on Monday at its lowest level since July 22, as fears of a contagion from the Evergrande crisis in China roiled global stock markets and hit prices of commodities. [MKTS/GLOB]

"We're getting a bit of a bounce-back today as people are realizing things weren't as bad as they have been priced in yesterday," said Gregory Taylor, portfolio manager at Purpose Investments.

Leading gains were healthcare and energy stocks, up 2.53% and 1%, respectively.

Aiding sentiment, Trudeau hung onto power in the election, saying he had won a clear mandate to govern although he fell short of his goal for a majority win. The Liberals have pledged a substantial C$78 billion in new spending over five years.

Canada's benchmark stock index is still down about 2% so far in September after seven straight months of gains, on concerns of a stunted global economic recovery.

The energy sector jumped after oil prices rose on tighter U.S. supplies. It is the only major Canadian sub-index that is on course to post monthly gains. [O/R]

Meanwhile, the materials sector -- which includes precious and base metals miners and fertilizer companies -- gained 0.75% on higher bullion prices. It had touched its lowest level since March on Monday. [GOL/]

The heavyweight financials sector, which accounts to nearly 30% of the Toronto market's value, gained 0.8%.


Drugmaker Bausch Health Companies Inc and uranium miner Denison Mines Corp, were the largest percentage gainers on the index.

Across all Canadian issues, there were seven new 52-week highs and two new lows, with total volume of 26.87 million shares.

(Reporting by Amal S in Bengaluru; editing by Uttaresh.V)

By Amal S

© Reuters 2021
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