Canadian Stocks Rise as Financials Gain on U.S. Home Sales, FedEx Forecast
Canadian stocks rose, led by financial shares, after U.S. new home sales climbed more than estimated and FedEx Corp. boosted its profit forecast.
Brookfield Properties Corp., the owner of Canada’s tallest skyscraper and New York’s World Financial Center, gained 2.5 percent. Bank of Montreal, Canada’s fourth-largest bank, jumped 1.7 percent. Eastern Platinum Ltd. had the biggest gain in the benchmark equity index, increasing 7.3 percent.
The Standard & Poor’s/TSX Composite Index climbed 31.86 points, or 0.3 percent, to 11,746.07 as sales of new homes in the U.S., Canada’s biggest trade partner, rose more than economists estimated in June, a signal the worst of the slump triggered by the end of a government tax credit is over. FedEx Corp. raised its forecast for the quarter and year on rising demand for international express shipments.
“The market was a little bit encouraged by the FedEx statement,” said David Baskin, president of Baskin Financial Services Inc. in Toronto, which manages C$350 million ($332 million). “The housing stats in the United States are also affecting the market. We’re generally positive in our outlook. Corporate earnings so far in the U.S. and also in Canada have been very positive.”
The S&P/TSX rose 1.3 percent last week as most lenders passed a European stress test and U.S. companies reported earnings that topped analyst estimates.
Banks Gain
Bank of Montreal rose 1.7 percent to C$62.85, as an index of financial shares in the S&P/TSX rose the most of 10 industry groups. Toronto-Dominion Bank, the country’s second largest, rose 1.4 percent to C$72.92.
Brookfield Properties jumped 2.5 percent to C$16.32. The company is scheduled to report second-quarter earnings on July 30.
Eastern Platinum, which mines in South Africa, surged 7.3 percent to C$1.03. The shares rallied on signs of economic strength in Europe as U.K. GDP jumped 1.1 percent in the second quarter, German business confidence unexpectedly surged to a three-year high this month, and the European stress-test results showed the majority of the region’s banks are adequately capitalized, according to Bart Jaworski, equity analyst at Raymond James in Vancouver.
“I think it’s mostly positive news out of Europe,” he said. European demand for catalytic converters “is a big portion of platinum demand.” Jaworski reiterated his “outperform” rating on the shares.
Copper Prices
Copper prices climbed to a 10-week high, bolstering gains for companies that mine the metal. Quadra FNX Mining Ltd., the Vancouver-based owner of mines in Nevada, Arizona and northern Chile, gained 2.3 percent to C$12.71. Inmet Mining Corp., a producer of copper in Spain, rallied 1.9 percent to C$49.25.
Lundin Mining Corp., which produces base metals in Europe, climbed 1.8 percent to C$3.99. The company is scheduled to report second-quarter earnings on July 28.
Rogers Communications Inc., Canada’s largest wireless carrier, rose 0.8 percent to $37.40, the highest intraday price in more than two years. The company is scheduled to report second-quarter earnings tomorrow.
Gold producers led losses in the S&P/TSX as gold fell for a second session on signs that demand for the metal as an investment haven is slowing as the euro stabilizes against the dollar. NovaGold Resources Inc., which explores in the U.S. and Canada, retreated 3.9 percent to C$6.41 for the second-biggest loss in the S&P/TSX. New Gold Inc., which mines in Australia, Mexico and the U.S., declined 2.3 percent to C$5.15.
Fertilizer Producer
Potash Corp. of Saskatchewan Inc. slumped 1.2 percent to C$100.79 after corn, wheat and soybean prices declined. The world’s biggest fertilizer producer is scheduled to report second-quarter earnings on July 29. Agrium Inc., Canada’s second-largest fertilizer producer, retreated 2.2 percent to C$61.55.
Research in Motion Ltd. fell 0.9 percent to C$57.18. The company’s BlackBerry smartphones may be subject to monitoring in the United Arab Emirates if the government is able to bring communications by the handheld devices under emergency and security rules.
Silvercorp Metals Inc., a silver producer, slumped 3.5 percent to C$6.63 after it said heavy rainfall in China damaged operations at the Ying mining camp.
To contact the reporter on this story: Kelly Bit in New York at kbit@bloomberg.net
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