TSX adds to second-quarter gain as trade talks resume

By Fergal Smith

(Reuters) -Canada's main stock index rose on Monday to a record high, helped by gains for financial and gold mining shares, as the resumption of trade talks between Canada and the United States cheered investors.

The S&P/TSX composite index ended up 164.79 points, or 0.6%, at 26,857.11, eclipsing the record closing high it posted on Thursday. For the quarter, it was up 7.8%, its fourth straight quarterly advance, while it has gained 8.6% since the start of the year.

The United States will resume trade negotiations with Canada immediately, White House economic adviser Kevin Hassett said. The move follows Ottawa scrapping its digital services tax targeting U.S. technology firms. Canada sends about 75% of its exports to the United States, including autos, steel and aluminum, which have been hit by hefty U.S. duties.

"Trade talks are continuing. The government's not letting them go off the rails," said Colin Cieszynski, chief market strategist at SIA Wealth Management.

"The market has climbed the wall of worry" in recent months as uncertainties related to trade policy and domestic politics started to clear, Cieszynski said.

Canadian Prime Minister Mark Carney's Liberal Party retained power in April's general election, proposing sweeping changes to boost economic growth.

The materials group, which includes fertilizer companies and metal mining shares, rose 1.6% on Monday as the price of gold climbed.

Heavily weighted financials added 0.6% and technology ended 0.9% higher.

Of 10 major sectors, only energy ended lower. It lost 0.5% as the price of oil settled 0.6% lower at $65.11 a barrel, weighed by easing Middle East risk and a possible OPEC+ output increase in August.

(Reporting by Fergal Smith in Toronto and Sukriti Gupta and Twesha Dikshit in Bengaluru; Editing by Shreya Biswas and Matthew Lewis)

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