Yahoo Finance TSX rises as higher oil prices support energy stocks
By Fergal Smith
TORONTO (Reuters) - Canada's main stock index rose on Monday as the energy sector benefited from higher oil prices, but gains were restrained as investors waited for clues this week on the outlook for U.S. monetary policy.
The index (.GSPTSE) has rallied 28 percent since hitting a 3-year low in January, helped by a rebound in commodity prices and low global interest rates. On Thursday it reached a 13-month high of 14,855.69, raising concerns that the rally might be overdone.
"We still think that markets are trading at elevated valuation ... earnings and revenue trends on both the TSX (Toronto Stock Exchange) and S&P (500) haven't been strong," said Manash Goswami, portfolio manager, First Asset Investment Management Inc.
The U.S. Federal Reserve's minutes on its July policy meeting are scheduled to be released on Wednesday.
Investors will hold off on making big bets until they get a sense of whether the Fed has become more inclined to raise interest rates this year, Goswami said.
The Toronto Stock Exchange's S&P/TSX composite index closed up 29.57 points, or 0.2 percent, at 14,777.02.
Five of the index's 10 main groups ended in positive territory.
The energy sector advanced 1.2 percent, helped by higher oil prices on growing speculation that producers could take measures to support prices in an oversupplied market.
U.S. crude oil futures settled up $1.25 at $45.74 a barrel.
Canadian Natural Resources Ltd (Toronto:CNQ.TO - News) advanced 0.8 percent to C$41.97 and Cenovus Energy Inc (Toronto:CVE.TO - News) climbed 3.1 percent to C$19.75.
Industrials rose 0.4 percent. It included a 0.5 percent gain for Canadian Pacific Railway Ltd (Toronto:CP.TO - News), one of the index's two big railway stocks, to C$192.23.
Drugmaker Valeant Pharmaceuticals International Inc (Toronto:VRX.TO - News) jumped 6.3 percent to C$34.36, as Mizuho upgraded its recommendation on the stock to "neutral." Last week the stock had rallied to a two-month high on news of its strategic overhaul, before falling sharply on a report that it was the subject of a criminal probe.
The heavyweight financials group firmed 0.1 percent, while the materials group, which includes precious and base metals miners and fertilizer companies, was little changed.
Spot gold rose 0.3 percent.
Sales of existing Canadian homes fell for the third month in a row in July, data showed, as fewer homes changed hands in Vancouver and other areas in British Columbia that are among the country's hottest property markets.
(Additional reporting by Alastair Sharp; Editing by Chizu Nomiyama and Richard Chang)
