Canadian Stocks Rally as Oil, Gold Advance; Bombardier Surges

Canadian stocks rose, extending a third-straight quarterly gain, as oil advanced the day before the U.S. March employment report and gold climbed after European inflation exceeded most economists’ forecasts.

Bombardier Inc. (BBD/B), the maker of trains and airplanes, jumped 13 percent after reporting earnings that topped the average of 20 analyst estimates by 43 percent, excluding certain items. Suncor Energy Inc. (SU), Canada’s largest oil and gas producer, increased 1.3 percent as oil rose on concern the Libyan conflict will cut production. Potash Corp. of Saskatchewan Inc. rallied 1.1 percent after the U.S. reported smaller corn inventories than most analysts had estimated.

The Standard & Poor’s/TSX Composite Index climbed 54.16 points, or 0.4 percent, to 14,137.74 at 1:50 p.m. in Toronto.

“Oil’s up because people are expecting good jobs numbers,” said Paul Ma, who manages C$500 million ($514 million) as a money manager at McLean & Partners in Calgary. “Economic growth is up, people drive more cars. Gold is up because of inflation. When there’s inflation, where do people go? Gold.”

The index had gained 4.8 percent this quarter through yesterday as the Canadian and U.S. economies expanded and oil prices surged 14 percent on unrest in the Middle East. If the equity benchmark closes above 14,136.50, it will complete its ninth-straight monthly advance, the longest streak in 27 years.

Train Contract

In addition to reporting its biggest quarterly profit in two years, Bombardier said today it won a A$269 million ($278 million) train contract from the government of South Australia.

Shares of the Montreal-based company rose 13 percent to a 30-month high of C$7.15.

Crude increased as much as 2.4 percent. Suncor climbed 1.3 percent to C$43.94. Pacific Rubiales Energy Corp. (PRE), which produces oil in Colombia, advanced for the first time in eight days, rallying 2.2 percent to C$26.44.

Bankers Petroleum Ltd. (BNK), which produces oil and gas in Albania, surged 7.8 percent to C$8.75 after agreeing to pay Albpetrol Sh.A. $34 million to take over 140 wells.

Precious-metals producers climbed after the European Union said consumer prices rose the most in more than two years in March. Bond yields increased in Ireland, Spain, Portugal and Greece.

Barrick Gold Corp. (ABX), the world’s largest gold producer, gained 0.9 percent to C$50.55. Goldcorp Inc. (G), the No. 2 producer of the metal by market value, advanced 1.1 percent to C$48.64. Rubicon Minerals Corp. (RMX), which explores for gold in Ontario, soared 15 percent to C$5.01 after releasing a resource estimate.

Production Forecast

Osisko Mining Corp. (OSK), which is developing a gold project in Quebec, dropped 3.5 percent to C$14.01 after saying 2011-12 production may be lower than it previously forecast.

Potash Corp., the world’s largest fertilizer producer, and Agrium Inc. (AGU) rose after the U.S. Agriculture Department said corn stocks fell 15 percent from a year earlier.

Potash Corp. gained 1.1 percent to C$57.19. Agrium Inc., Canada’s second-largest fertilizer producer, advanced 3.1 percent to C$89.71.

Central banks’ asset-purchasing programs, known as quantitative easing, were the stimulus for the S&P/TSX’s streak of increases, Ma said.

“Quantitative easing, whether from Japan, from Europe, from London or from the Fed, 100 percent of the time lifts the market up,” he said. When the Fed announced a second round of easing in November, “we put all our money in. We went pedal to the metal.”

To contact the reporter on this story; Matt Walcoff in Toronto at mwalcoff1@bloomberg.net.

To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net.

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