By Johann M Cherian
(Reuters) - Canada's main stock index edged up on Friday as investor sentiment gained steam after data showed the domestic economy grew more than expected in January.
Rogers Communications (TSX:RCIa) reversed earlier gains and fell 1.0% after its C$20 billion ($15 billion) bid for Shaw Communications Inc (TSXV:SJRa) was cleared by the Canadian government, making it the country's No. 2 telecoms firm.
Shares of Shaw communications advanced 3.2% and the broader tech sector was up 1.5%.
A Statistics Canada report showed that the Canadian economy performed better-than-expected in January versus December, driven by broad gains in both goods and services industries.
At 10:10 a.m. ET (1410 GMT), the Toronto Stock Exchange's S&P/TSX composite index was up 130.39 points, or 0.65%, at 20,071.38.
"The strength in January is consistent with an economy that remains resilient," said Angelo Kourkafas, investment strategist at Edward Jones Investments.
"The Bank of Canada will still stick to its conditional pause and will be sensitive to any upside surprises in inflation".
The energy sector added 0.6% and the materials sector rose 0.6% after data reflecting cooling inflation in the United States tempered worries of further demand denting interest rate hikes. [GOL/] [MET/L] [O/R]
(Graphic: Canada sector-wise performance QTD - https://fingfx.thomsonreuters.com/gfx/mkt/movakwgrxva/Canada%20sector-wise%20performance%20Q1%20QTD%20'23.png)
The TSX is set to end the quarter up by nearly 3.5% and is on course to close at its highest levels in a year.
Following an uptick in January the index is eyeing its second straight month of losses in March, as worries of further rate hikes out of the United States and a banking sector contagion weighed on sentiment.
First Quantum Minerals (TSX:FM) Ltd added 2.7% after Rio Tinto (LON:RIO) Ltd, said the miners will form a joint venture to develop the La Granja copper project in Peru, with the Canadian miner buying a 55% stake in the project.