TSX posts biggest gain in 10 months on economic optimism

·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 index rallied on Tuesday as domestic data showed hints of easing supply chain pressures and investors bet that the economy would be able to handle headwinds from the rapidly spreading Omicron COVID-19 variant.

The Toronto Stock Exchange's S&P/TSX composite index ended up 386.65 points, or 1.9%, at 20,924.87, its biggest gain since February.

Wall Street's main indexes also rallied as beaten-down big technology stocks bounced back from an Omicron-driven rout in the previous session.

"Today's strength reflects confidence that the economy will be able to navigate successfully the threat from the Omicron variant," said Angelo Kourkafas, investment strategist at Edward Jones.

"We saw retail sales surprise to the upside today, led by a rebound in auto sales. That might be one sign that the supply disruptions might be easing at the margin," Kourkafas added.

Canadian retail trade is set to rise in November after beating analyst estimates in October, led by higher sales at motor vehicle and parts dealers as the effects of the semiconductor chip shortages eased, Statistics Canada data indicated.

All eleven of the Toronto market's main sectors ended higher, including a 3% advance for energy as oil prices rose. U.S. crude prices settled 3.7% higher at $71.12 a barrel.

The heavily weighted financial services group gained 1.2%, while technology ended 3.9% higher.

Healthcare advanced 5.1% as cannabis producers bounced back from the previous session's tax-loss selling.

(Reporting by Fergal Smith; Additional reporting by Amal S in Bengaluru; Editing by Dan Grebler)

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