* TSX rises 127.30 points, or 1.02 percent, to 12,560.83
* Materials up 1.9 percent, financials rise 0.6 percent
* Eight of 10 main sectors advance
By John Tilak
TORONTO, Jan 2 Canada's main stock index gained
1 percent to hit a 9-month high on Wednesday, led by material
and financial stocks, as investors lauded a deal by lawmakers in
the United States, Canada's biggest trading partner, to resolve
a high-stakes budget crisis.
The U.S. averted economic calamity when lawmakers approved a
deal late on Tuesday to avoid a "fiscal cliff" of massive tax
hikes and spending cuts that had threatened to tip the world's
largest economy into recession.
"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 Toronto Stock Exchange's S&P/TSX composite index
was up 127.30 points, or 1.02 percent, at 12,560.83,
after earlier reaching 12,588.75, its highest since March 27,
Eight of the 10 main sectors on the index rose.
Mining and financial shares, which suffered the most in
recent months due to uncertainty over how the U.S. would resolve
its fiscal crisis, benefited the most from Tuesday's deal.
The materials sector was up 1.9 percent, buoyed by higher
commodity prices and a 1-percent rise in the price of gold.
Goldcorp Inc rose 1.6 percent to C$37.14 and Barrick
Gold Corp gained 0.8 percent to C$35.11. Teck Resources
Ltd gained 3 percent to C$87.24.
The financial group, the index's biggest, advanced 0.6
percent. Royal Bank of Canada rose 0.7 percent to
C$60.28, and Manulife Financial Corp gained 2.2 percent
Suncor Energy Inc rose 1.4 percent to C$33.18,
tracking higher oil prices. That helped the energy sector
gain nearly 1 percent.
On the downside, shares of Petrobank Energy and Resources
tumbled 92 percent to C$1.03 as the company completed a
major reoganization under which it distributed its 57 percent
stake in PetroBakken Energy Ltd, the unconventional
light oil producer, to its shareholders.
The new Petrobank will own and operate its predecessor's
heavy oil business as well as the company's oil recovery