TSX rises on U.S. budget hopes, financials lead

TORONTO (Reuters) - The Toronto Stock Exchange's benchmark S&P/TSX composite index <.gsptse> was higher on Wednesday with financial stocks leading the way on optimism that talks to avoid the U.S. budget "fiscal cliff" would succeed.

With less than two weeks left to avert automatic U.S. tax increases and spending cuts that threaten to throw the economy back in recession, congressional Republicans and the White House had yet to agree on a resolution, but both sides remained hopeful.

"It's very much an issue in terms of short-term trade. In terms of longer-term outlook, it's not as much of an issue, because something has to be done," said Gareth Watson, vice president, investment management and research, at Richardson GMP.

"Traders are not exactly sure which way to go ... There's probably more optimism involved here than a couple of weeks ago. But still definitely a lot of caution out there."

The Toronto Stock Exchange's S&P/TSX composite index <.gsptse> was up 71.1 points, or 0.58 percent, at 12,405.45. Eight of the index's main groups were positive.

Financial stocks were up 1.07 percent, with the top five index leaders all in that sector. Royal Bank of Canada was the biggest gainer, up 1.17 percent at C$60.55. Toronto-Dominion Bank followed with a 1.22 percent rise to C$83.14.

Energy stocks rose 0.57 percent, with Suncor Energy climbing 0.86 percent to $32.93. Oil prices rose on expectations that the U.S. budget crisis would be resolved, heading off the threat of recession in the world's top oil consumer.

Technology stocks rose 1.56 percent, tracking U.S. technology shares following strong results from Oracle Corp.

BlackBerry maker Research In Motion , which reports quarterly results on Thursday, was up 1.41 percent at C$13.66.

(Editing by Peter Galloway)

Source: http://news.yahoo.com/tsx-may-open-higher-u-budget-deal-gets-132941391--sector.html

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