Canadian stocks extend rally as health care surges

Canada's main stock market in Toronto extended its strongest level in over a year on Tuesday as the health care sector rallied with a jump in shares of a heavyweight drug company.

The Toronto Stock Exchange's benchmark Standard & Poor's/TSX Composite Index gained 45.61 point, or 0.31 percent, to close at 14,801.23 points. Five of the TSX index's eight main sub-sectors were higher.

Oil prices slipped on Tuesday after a government agency raised its projection for U.S. oil output next year.

Texas light sweet crude for September delivery lost 0.25 U.S. dollars to settle at 42.77 U.S. dollars a barrel in New York, while Brent crude for September delivery erased 0.41 U.S. dollars to close at 44.98 U.S. dollars a barrel in London.

TSX energy ticked up 0.03 percent as Encana Corporation added 0.35 percent to 11.51 Canadian dollars (8.77 U.S. dollars) while Suncor Energy Inc. gained 0.73 percent to 35.90 Canadian dollars.

Health care sector jumped 6.05 percent as Valeant Pharmaceuticals International hiked 24.97 percent to 36.88 Canadian dollars after the drug company stuck to its full-year forecast and said it expects to sharply reduce its debt load.

The materials group, which includes precious and base metals miners and fertilizer companies, added strength, with B2Gold Corp. up 1.78 percent to 4.58 Canadian dollars.

Royal Bank of Canada rose 0.44 percent to 80.22 Canadian dollars, Toronto-Dominion Bank gained 0.47 percent to 57.31 Canadian dollars, and Bank of Nova Scotia added 0.34 percent to 66.90 Canadian dollars.

On the economic scene, Canada Mortgage and Housing Corporation reported that the seasonally-adjusted annualized rate of housing starts declined to 198,395 in July, down from a revised 218,326 in June. Economists had forecast 195,000 starts in July.

The Canadian dollar traded higher at 0.7620 U.S. dollar, compared with Friday's closing rate of 0.7597 U.S. dollar. Endit