By Fergal Smith
(Reuters) -Canada’s main stock index rose by the most in seven weeks on Monday, clawing back some recent declines, as investors rotated their holdings out of technology into resource and interest rate sensitive shares.
The Toronto Stock Exchange’s S&P/TSX composite index ended up 293.73 points, or 1.4%, at 21,848.59, its biggest gain since May 6. On Friday, the index posted its fifth straight weekly decline.
“It’s been overdue for a rebound,” said Elvis Picardo, a portfolio manager at Luft Financial, iA Private Wealth.
“There’s possibly some profit taking in the big caps … I think there’s some sector rotation going on too because some of the valuations in the other sectors look really attractive. When that kind of sector rotation tends to happen it generally benefits the TSX.”
The TSX’s forward price earnings ratio, a key valuation metric, at 14.3, is much less than the 22.4 level for U.S. benchmark the S&P 500, data…
