CANADA STOCKS-Railways help TSX make slight gains; resources weigh

Reuters

* TSX up 8.63 points, or 0.07 percent, at 13,256.69

* Two biggest railways jump on strong earnings

* Glut of oil in U.S. weighs on energy companies

By Alastair Sharp

TORONTO, Oct 23 (Reuters) - Canada's main stock index ekedout a small gain in morning trade on Wednesday as strong resultsfrom the country's two biggest railways offset losses in energyand mining companies.

Canadian Pacific Railway Ltd, Canada's No. 2 railoperator, surged 6.2 percent to C$143.20 after reporting a 45percent jump in profit as freight revenue rose and operatingcosts fell.

Canadian National Railway Co, the No. 1 operatorand focus of scrutiny after one of its trains derailed andcaught fire last weekend, jumped 2.7 percent to C$112.71 afterreporting a market-beating third-quarter profit and recordrevenue late on Tuesday, as well as a two-for-one stock splitand share buyback plan.

The railways should prosper as the economy grows but thepotential for growing opposition to their carriage of naturalresources was a concern, said Rick Hutcheon, president and chiefoperating officer at RKH Investments.

"A great deal of the current growth in their earnings iscoming from oil-by-rail," he said.

The Toronto Stock Exchange's S&P/TSX composite index was up 8.63 points, or 0.07 percent, at 13,256.69 bymid-morning. It opened in the red. The index has been on asix-session rally, pushing it to two-year highs.

Energy stocks weighed most heavily, pressured by amplesupplies and expectations of a further inventory buildup in theUnited States, the world's top consumer.

Suncor Energy Inc slipped 1.4 percent to C$36.98 andCanadian Natural Resources Ltd declined 1.5 percent toC$32.50.

CGI Group fell 3.5 percent to C$34.80. Thecontractor that built HealthCare.gov has fallen 9 percent in thelast week as the U.S. health insurance program sufferedtechnical glitches.

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