By Johann M Cherian and Fergal Smith
(Reuters) - Canada's commodity-heavy main stock index rose on Friday to its highest closing level in more than two weeks as encouraging economic data from major energy importer China allayed fears of a global economic slowdown.
Activity in China's services sector expanded at the fastest pace in six months in February as the removal of tough COVID-19 restrictions revived customer demand.
"China was closed for months and just improving economic data gives buyers of commodity stocks confidence that those prices can hold, and as we know it is a good chunk of the TSX index," said Barry Schwartz, portfolio manager at Baskin Financial Services.
The Toronto Stock Exchange's S&P/TSX composite index ended up 244.37 points, or 1.2%, at 20,581.58, its highest closing level since Feb. 16. For the week, it was up 1.8%, after a three-week decline.
Wall Street also advanced as U.S. Treasury yields eased and economic data helped investors look past the growing likelihood that the Federal Reserve will keep its restrictive policy in place for longer than anticipated.
The Toronto market's energy sector gained 1.7% as oil settled 1.9% higher at $79.68 a barrel, while the materials group, which includes precious and base metals miners and fertilizer companies, added 1.5%.
Combined, the energy and materials sectors account for about 30% of the TSX's weighting.
All ten of the TSX's major sectors gained ground, including a gain of 2.4% for technology, while financials were up 0.9%.
Among individual stocks, Suncor Energy (NYSE:SU) Inc added 1.4% after Equinor said it would acquire the British oil and gas business of the energy firm for $850 million.
Sleep Country Canada Holdings Inc was up 5.9% after the company's fourth-quarter sales and earnings beat estimates.