TSX gains capped by weak energy shares

By Alastair Sharp TORONTO (Reuters) - Canada's main stock index gained on Wednesday in choppy trading as financial and consumer stocks rose but were offset by energy shares plagued by volatile crude oil prices. Drugmaker Valeant Pharmaceuticals International Inc , one of the largest issuers on the index, jumped 4.1 percent to C$308.45 after the company said it had agreed to buy surgical device maker Synergetics USA Inc , its eighth acquisition this year. But the index underperformed U.S. markets as the energy group weighed despite a bounce in oil prices. [.N][O/R] "There's that cloud that continues to hang over the Canadian equity space, which is the volatility that still persists in oil prices," said Shailesh Kshatriya, an associate director for client strategy at Russell Investments Canada. The Toronto Stock Exchange's S&P/TSX composite index <.GSPTSE> ended up 63.35 points, or 0.47 percent, at 13,545.25. Seven of its 10 main groups rose. Insurer Manulife Financial Corp gained 1.1 percent to C$20.55 and Brookfield Asset Management rose 1.2 percent to C$41.16. The index gyrated as investors digested reports about China's latest effort to soothe anxiety about the country's slowing growth and what that means for the global economy. Chinese markets, which have fluctuated widely in recent months, are closed on Thursday and Friday. "Volatility continues to rule the day, both to the upside and the downside," said Craig Fehr, Canadian market strategist at Edward Jones in St. Louis. "It partly reflects markets trying to digest what the bigger trend is in China." "On-the-fly" policy reactions out of Beijing are contributing to the dramatic daily swings, Fehr added. The focus on China, fluctuating commodity prices and uncertainty around the U.S. Federal Reserve's decision on interest rates will keep markets on edge, he said. Russell's Kshatriya said North American markets will next turn to employment data due on Friday and then rate decisions from the Bank of Canada next week and the Fed a week after. "Expect a lot of volatility over the next couple of weeks," he said. Convenience store operator Alimentation Couche-Tard Inc gained 4.6 percent to C$59.30 a day after reporting robust U.S. growth. Eleven of the top 20 biggest drags on the index were oil and gas companies, with Suncor Energy Inc off 2.1 percent to C$35.00 and the overall group down 1 percent. Fehr said the market's recent declines made for a good buying opportunity for investors, but those eyeing energy or materials stocks needed to be patient. (Reporting by Solarina Ho; Editing by Lisa Von Ahn and Steve Orlofsky)