TSX touches 9-month high on U.S. budget deal

TORONTO (Reuters) - Canada's main stock index rose in the year's first trading session on Wednesday, touching a nine-month high, as commodities rallied on a deal to resolve the high-stakes U.S. budget crisis.

The U.S. averted possible economic calamity when lawmakers approved a deal late on Tuesday to avoid a "fiscal cliff" of tax hikes and spending cuts that had threatened to tip the world's largest economy into recession.

"It is good to see the TSX get off to a fairly decent start, but it's not been anywhere near as strong as the rally in the U.S., which is not really surprising," said Elvis Picardo, strategist at Global Securities in Vancouver.

Picardo said the U.S. budget deal only addresses one of several issues that have been holding back the Canadian market, such as signs the domestic economy has slowed and worries about the housing market.

Even so, all 10 main sectors advanced. The Toronto Stock Exchange's S&P/TSX composite index <.gsptse> closed up 107.24 points, or 0.86 percent, at 12,540.77, after earlier reaching 12,588.75, its highest since March 27, 2012.

"It's a matter of hope and confidence that all this stuff that's been overhanging the market over the last number of weeks can be put to rest now, and we can see if we can find something else to worry about," said Fred Ketchen, director of equity trading at ScotiaMcLeod.

"There's a little more confidence and a little more comfort in the minds of investors," he said.

The materials sector, home to mining companies, was the biggest boost to the index, rising 1.8 percent. The Thomson Reuters-Jefferies CRB Index <.trjcrb>, which tracks commodity prices, rose 0.9 percent.

Teck Resources Ltd , Canada's largest diversified miner, rose 3.7 percent to C$37.50 as copper rose on the budget deal and on upbeat data out of China.

Suncor Energy Inc led the index higher, closing up 2.1 percent to C$33.41, tracking higher oil prices. The energy sector rose 0.9 percent overall.

The financial group, which in recent weeks has been rising and falling with the perceived chance of U.S. budget deal, closed up 0.4 percent. Royal Bank of Canada rose 1.0 percent to C$60.50, and Manulife Financial Corp gained 1.2 percent to C$13.67.

Picardo said he sees the TSX lagging U.S. equity markets in 2013, grinding out positive returns, but nothing spectacular, even if the global economy improves more than expected.

"For the TSX to really do well, you need a big resurgence in risk appetite, and while things are improving incrementally, we don't see a big return to risk this year," he said.

Iron ore miners rose, buoyed in part by ArcelorMittal's $1.1 billion deal to sell a minority stake in its Eastern Canadian operations to an Asian consortium. Outside the index, Labrador Iron Mines Holdings Ltd soared 31.8 percent to C$1.45.

(Additional reporting by John Tilak; Editing by Leslie Adler)

Source: http://news.yahoo.com/tsx-may-open-higher-u-strikes-fiscal-deal-132507156--finance.html

lra lra eric johnson eric johnson big east tournament ashley olsen new apple tv