Canada's main stock market rebounds as central bank lowers interest rate

Toronto Stock Exchange, Canada's main stock market, rose to a two-week high Wednesday after Bank of Canada cut its benchmark interest rate.

Toronto Stock Exchange's S&P/TSX composite index soared 251.98 points, or 1.76 percent, to close at 14,560.42 points. Six of the eight major sectors were in the rising streak, with strong rallies in metals and energy shares.

Bank of Canada, the country's central bank, announced Wednesday that it is lowering its key interest rate to 0.75 percent from 1 percent. The rate had been remaining unchanged at 1 percent for more than four years. This decision was made in response to the recent sharp drop in oil prices, which will be negative for growth and underlying inflation in Canada.

The equities market hailed the unexpected move of the central bank.

As a direct response, the index's most heavily weighted sector Financials advanced 1.49 percent. Royal Bank of Canada added 1.59 percent to 76.61 Canadian dollars (about 62.11 U.S. dollars), and Toronto-Dominion Bank moved up 1.03 percent to 50.95 Canadian dollars.

And TSX gainers were led by a rise of 5.67 percent in the metals and mining sector. The basic metals producers Teck Resources Ltd. gained 8.40 percent to 15.87 Canadian dollars and First Quantum Minerals Ltd. climbed 6.19 percent to 14.58 Canadian dollars.

Energy shares rallied 3.15 percent, with Suncor Energy Inc. jumping 4.21 percent to 36.40 Canadian dollars, and Canadian Natural Resources Ltd. surging 4.80 percent to 35.82 Canadian dollars.

However, Telecom sector fell 1.69 percent, leading the decliners, when the telecommunication giants Telus Corp. shares slipped 0.42 percent to 42.65 Canadian dollars apiece and Rogers Communications Inc. plummeted 0.97 percent to 45.90 Canadian dollars a share.

On the economic front, Statistics Canada reported Wednesday morning that wholesale sales declined 0.3 percent to 54.0 billion Canadian dollars in November, following two consecutive monthly gains.

On the currency front, the Canadian dollar dived to a six-year low Wednesday to 0.8107 U.S. dollar, compared with 0.8260 U.S. dollar in Tuesday's trading. Endite