Canada's TSX ends above 20,000 for first time as resource shares rally

·1 min read
FILE PHOTO: A sign board displaying Toronto Stock Exchange stock information is seen in Toronto

By Fergal Smith

TORONTO (Reuters) -Canada's main stock market index closed above 20,000 on Friday for the first time, extending a sharp rebound from its low last year during the COVID-19 crisis as higher commodity prices bolstered the shares of resource companies.

The Toronto Stock Exchange's S&P/TSX composite index closed up 87.80 points, or 0.4%, at 20,029.19. Investors say that 20,000 is a key psychological level.

Since March 2020, the index has soared nearly 80%.

With commodity prices surging, the TSX has outpaced Wall Street this year, with a gain of 14.9%. Materials and energy shares account for 25% of the Toronto market's capitalization, compared with 5% for the S&P 500.

Higher commodity prices are "making the Canadian market more attractive," said Norman Levine, managing director, Portfolio Management Corp.

The index is likely to make further new highs, Levine added.

The TSX is expected to rise to 21,750 by the end of 2022, a Reuters poll showed last month.

The energy sector was up 1.4% on Friday, helped by the highest level for crude oil in nearly three years at $69.76 a barrel, while the materials group, which includes precious and base metals miners and fertilizer companies, added 1.6%.

Gold rose 1.1% to $1,891 an ounce after data showed U.S. nonfarm payrolls rising less than expected in May.

Separate data showed Canada shedding more jobs than expected in May amid continued lockdowns to curb a harsh third wave of COVID-19, but economists were quick to predict a rush of hiring in June as those restrictions ease.

(Reporting by Fergal Smith; Editing by Cynthia Osterman)

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