Canadian Stocks Advance as Financials, Energy Producers Rally
Canadian stocks climbed for the first time in three days as financial companies and energy producers rallied after U.S. weekly jobless claims fell to the lowest level since July 2008.
Royal Bank of Canada, the country’s biggest lender by assets, advanced 1.8 percent as financial stocks snapped a two- day decline. Suncor Energy Inc., Canada’s largest oil and gas producer, jumped 1.3 percent as crude climbed. Cameco Corp., the world’s second-largest uranium producer, rose 4.4 percent after it agreed to supply the fuel to China Guangdong Nuclear Power Holding Co.
“We’re following an uplift to all the events happening in the States, and what’s key was the employment number,” said Greg Eckel, a portfolio manager at Morgan Meighen & Associates Ltd. in Toronto, which oversees about C$900 million ($890 million). “Financials have been hit recently so it’s a relief for them. Oil’s just been bouncing around. It’s comforting that the $80 level was held and now we’re up at $82.”
The Standard & Poor’s/TSX Composite Index gained 108.24 points, or 0.9 percent, to 12,901.99 as of 4 p.m. in Toronto.
The benchmark has declined 1.2 percent since Nov. 8 after surging 14 percent in the prior four months. The rally has trailed off as concern has mounted that more European countries will have trouble paying their debts and China twice increased reserve requirements for banks.
Royal Bank of Canada gained 1.8 percent to C$54.96 as financial companies in the S&P/TSX rose 1 percent. Toronto- Dominion Bank advanced 1.3 percent to C$74.81.
Suncor Energy jumped 1.3 percent to C$34.39 as energy companies gained 1.3 percent, the biggest advance in the S&P/TSX. Crude oil gained 3.2 percent to settle at $83.86 a barrel in New York after the U.S. Labor Department reported that jobless claims fell to the lowest level since 2008.
BlackBerry maker Research In Motion Ltd., which gets most of its sales in the U.S., rose 1.8 percent to C$60.21, driving technology shares to a 1.2 percent gain.
Jobless claims in the world’s largest economy declined by 34,000 to 407,000 in the week ended Nov. 20. The median projection of economists surveyed by Bloomberg News called for a drop to 435,000.
A separate report showed that household purchases in the U.S. rose 0.4 percent after a 0.3 percent gain in September that was larger than previously estimated.
A gauge of German business confidence improved and Ireland announced plans to cut spending 20 percent, bolstering optimism about the global recovery. Welfare cuts of 2.8 billion euros ($3.8 billion) and income tax increases of 1.9 billion euros are among the steps planned to narrow the budget deficit to 3 percent of gross domestic product by the end of 2014.
Cameco increased 4.4 percent to C$37.58 after it agreed to supply the fuel to China Guangdong Nuclear Power through 2025 to meet rising demand in the world’s fastest-growing nuclear market.
The Saskatoon, Saskatchewan-based company said in a statement yesterday it plans to sell 29 million pounds of uranium concentrate to China Guangdong Nuclear, subject to the approval of the Chinese government. That’s equivalent to about 13,000 metric tons. Uranium One Inc. rose 6.9 percent to C$4.97, the biggest jump in the S&P/TSX.
Maple Leaf Foods
Maple Leaf Foods Inc., Canada’s largest meat-products producer, dropped 10 percent to C$11.41, the biggest decline in the S&P/TSX. The company said yesterday Ontario Teachers’ Pension Plan Board will sell 21 million of its 34.5 million Maple Leaf shares for C$10.50 each.
Potash Corp of Saskatchewan Inc. gained 1.5 percent to C$145.40. The world’s largest fertilizer producer received a “neutral” rating in new coverage by Goldman Sachs Group Inc. analyst Robert Koort.
Eagle Energy Trust was at C$10.01 after its first day of trading after completing an initial public offering of 15 million units at C$10 each.
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