CANADA STOCKS-TSX climbs on mining boost; Alamos Gold shines

(Updated at 10:05 a.m. ET)

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Alamos Gold to buy smaller peer Argonaut for $325 mln

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First Quantum execs discuss investment with Chinese officials

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TSX up 0.2%

By Johann M Cherian

March 27 (Reuters) - Canada's main stock index rose on Wednesday, boosted by gains in precious metals miners, while Alamos Gold was among the best performers after it announced a deal to buy smaller rival Argonaut.

At 10:05 a.m. ET (1405 GMT), the Toronto Stock Exchange's S&P/TSX composite index was up 46.04 points, or 0.21%, at 21,958.56.

The index is trading near record highs and is on track for its second straight quarterly gains, in tandem with optimism across developed equity markets as investors expect central banks to lower interest rates in 2024.

"Adding to the positive price action, there remains a healthy level of skepticism in the market, corporate earnings have come in better than expected and the economy continues to display remarkable resilience," said Brandon Michael, senior analyst at ABC Funds, in Toronto.

The materials sector, which includes precious and base metals miners and fertilizer companies, led the gains, up 1.5%, tracking higher gold and silver prices as investors awaited a key U.S. inflation data this week.

The February data for U.S. personal consumption expenditures, the Federal Reserve's preferred inflation gauge, is due on Friday and could help determine the outlook for its interest rate cuts expected later in the year.

The U.S. and Canadian markets are closed on Friday for the Good Friday holiday.

The energy sector lost 0.7%, tracking softer crude after data showed surging U.S. stockpiles and on signs the OPEC+ producer group is unlikely to change its output policy at a technical meeting next week.

Company-wise, Alamos Gold said it would acquire Argonaut Gold for $325 million in an all-stock deal. Shares of Alamos jumped 6.8% and were on track to notch their strongest day in more than 18 months.

First Quantum Minerals gained 4% after Reuters reported that executives from the miner met with Chinese government officials last week to discuss funding and business options involving top investor Jiangxi Copper. (Reporting by Johann M Cherian in Bengaluru; Editing by Shilpi Majumdar)