(Adds strategist comment, details; updates prices to close)
* Canadian dollar ends at C$1.3035, or 76.72 U.S. cents
* Bond prices flat to lower across the maturity curve
By Alastair Sharp
TORONTO, June 28 (Reuters) - The risk-sensitive Canadian
dollar ended stronger against the U.S. currency on Tuesday, as
global financial markets stabilized after two days of volatile
moves following Britain's vote to leave the European Union.
The loonie, as Canada's currency is colloquially known, also
gained against the safe-haven Swiss franc and Japanese yen,
although it traded weaker against a string of other currencies.
The loonie on Monday hit a three-week low against the
greenback at C$1.3120 as Brexit-related shockwaves filtered
through global financial markets.
"I don't think the mood has changed all that much, all we're
seeing is a bit of a recovery from the price action we've seen
since the referendum result was released," said Bipan Rai,
director of foreign exchange strategy at CIBC Capital Markets.
The Canadian dollar CAD=D4 settled at C$1.3035 to the
greenback, or 76.72 U.S. cents, up from than Monday's close of
C$1.3073, or 76.49 U.S. cents.
Its strongest level of the session was at C$1.2967, while
its weakest was C$1.3108.
Global stocks rose as bargain-hunting trumped still
widespread uncertainty over Brexit while oil prices rallied as
investors took advantage of low prices after a two-day slide.
O/R
But Canada's commodity-linked economy will likely suffer
weaker growth post-Brexit, which has put the prospect of
interest rate cuts by the Bank of Canada back on the table.
Overnight index swaps implied a nearly one-third chance of a
BoC rate cut this year after pricing in no change in policy
before Brexit. BOCWATCH
"Given the still pronounced economic headwind that Canada is
facing, I think it's reasonable to expect that dollar-Canada
should be trading up close to the C$1.36-$1.37 area in the
coming months," CIBC's Rai said.
Canadian government bond prices were flat to slightly lower
across the maturity curve as the rally in safe-haven assets
paused.
The two-year CA2YT=RR price dipped 1.5 Canadian cents to
yield 0.496 percent and the benchmark 10-year CA10YT=RR was
unchanged to yield 1.079 percent.
On Monday, the 10-year yield hit its lowest in 11 days at
1.077 percent.
Canadian gross domestic product data for April is due on
Thursday, and CIBC's Rai said that print "could tip the balance
of things one way or the other."
Economic growth is expected to have edged up 0.1 percent
following two months of declines. ECONCA