Canada's main stock market in Toronto on Wednesday rose sharply as the rising oil prices and neutral gross domestic product data from the country helped boost the trading sentiment. The Toronto Stock Exchange's benchmark Standard & Poor's/ TSX Composite Index rallied 202.05 points, or 1.54 percent, to 13,284. 91 points.
Resources sectors led the increase when the oil prices gained momentum over declining inventories and the Organization of Petroleum Exporting Countries on Wednesday predicted that oil price would rise to 70 U.S. dollars per barrel in 2020. The light, sweet crude oil for February delivery moved up 1.36 U.S. dollars to settle at 37.5 dollars a barrel on the New York Mercantile Exchange Wednesday.
Boosted by the positive stimulus, Energy jumped 5.82 percent with the oil and gas giant Encana Corporation going up 8.44 percent to 7.07 Canadian dollars (about 5.1 U.S. dollars) a share. And Metals and mining, another heavily-weighted resources sector in TSX, also soared 8.81 percent as the base metals producer First Quantum Minerals Ltd. shot up 17.19 percent to 6.00 Canadian dollars per share.
The equities market was also supported by the latest official economic data from Canada, indicating that the GDP growth was not falling into another slump since real GDP was unchanged in October, after falling 0.5 percent in September, and declines in manufacturing, utilities and retail trade were even offset by gains in mining, quarrying, and oil and gas extraction, according to Statistics Canada.
Canada's economy has certainly lost some steam, with the fourth quarter kicking off on a soft note. "While weakness was spread across several sectors in October, there is reason to believe that economic activity in Canada will pick up in 2016," said Dina Ignjatovic, an economist from TD Bank, in a report released Wednesday.
Financials, the most influential sector in TSX, rallied 0.85 percent, with Royal Bank of Canada adding 0.82 percent to 75 Canadian dollars. The Canadian dollar on Wednesday was traded higher to 0.7217 U. S. dollar, compared with 0.7175 U.S. dollar Tuesday.
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