Toronto stocks close at highest since Sept. 2000

Strong oil, gold prices lead way Blue chips eke out gain in New York

Toronto stocks hit their highest close in five years yesterday as rising mining and energy issues, buoyed by firm oil and gold prices, more than offset the impact of a widely expected interestrate hike. The Toronto Stock Exchange’s S& P/ TSX composite index closed up 88.04 points, or 0.8 per cent, at 11,096.82, the highest close since September 2000. Volume was a heavy 344 million shares worth more than $ 5.4 billion. Advancing stocks outpaced decliners 870 to 673.

Yesterday’s jump was led by a 1.76 per cent increase in the materials sector, which includes gold miners. Golds alone rose 2.2 per cent. Energy issues, which make up more than a quarter of the Toronto market, climbed 1.2 per cent.

“ It’s a reflection of the underlying commodity prices,” said Rick Hutcheon, chief investment officer with RKH Investments. “ There’s a lot of momentum buying. They’re the ones that are running, so those are the ones everybody plays. It’s the end of the year, so portfolio managers want to make sure they have a nice representation of some of these groups.” Gold prices closed at their highest in more than 24 years Tuesday, at one point touching $ 510.80 ( U. S.) an ounce, in a rally driven by inflation worries and funds diversifying into commodities for bigger returns, dealers said.

Barrick Gold Corp. rose 48 cents (Canadian), or 1.6 per cent, to $ 31.20.

Oil prices hovered at slightly less than $60 ( U. S.) a barrel after a four- day rally stoked by cold temperatures in the northeastern United States that pushed up demand for heating oil.

Stocks gained even as the Bank of Canada raised its benchmark overnight rate to 3.25 per cent from 3 per cent to try to keep the lid on inflation. Only two of the TSX index’s 10 main groups were lower, led by a 0.63 per cent decline in telecom shares. The Dow Jones industrial average closed up 21.85 points, or 0.20 per cent, at 10,856.86. The Nasdaq composite index was up 3.12 points, or 0.14 per cent, at 2,260.76. Among companies on the TSX, Montreal clothing chain Le Château Inc. said it earned $ 6.1 million ( Canadian) in the third quarter, up 25 per cent from $ 4.9 million a year earlier.

Earnings amounted to $1.03 per share for the three months ended Oct. 29, up from 92 cents. Sales increased 12 per cent to $ 69.2 million from $ 61.8 million. The shares rose $ 1.07, or 2.36 per cent, to $ 46.45.

Shares of Clarington Corp. lost 2 cents to $15.05 after news there might be one more round of bidding for the company. Some analysts predicted that mutual fund giant CI Financial Inc. would make a new offer before Christmas after Clarington threw its support behind a sweetened takeover bid from Industrial Alliance Insurance and Financial Services Inc.

“ At most, we’ve got one more round of bidding left,” John Aiken of National Bank Financial told Canadian Press. “ I think it is about even odds that CI comes back at this stage with another round.”

Industrial Alliance increased its offer for Clarington to $ 15 a share late Friday, beating CI’s latest bid of $ 14.75 a share for the Toronto- based wealth management company.