Canadian Stocks Advance as U.S. Durable-Goods Orders Increase

Canadian stocks rose for a third day, led by banks, as U.S. durable-goods orders doubled the median economist forecast.

Royal Bank of Canada (RY), the country’s largest lender by assets, advanced 2.4 percent after the U.S. Commerce Department said bookings for goods meant to last at least three years increased 4 percent last month. Barrick Gold Corp. (ABX), the world’s biggest gold producer, declined 3.7 percent as the metal’s futures sank the most since March 2008. Encana Corp. (ECA), Canada’s largest natural gas producer, climbed 2.5 percent as energy stocks rose.

The Standard & Poor’s/TSX Composite Index gained 5.48 points, or less than 0.1 percent, to 12,343.81.

“There seems to be a little bit of a pause on the panic of investors,” Tony Demarin, chief investment officer at BCV Asset Management in Winnipeg, Manitoba, said in a telephone interview. BCV oversees C$300 million ($304 million). “Durable goods are another reason why the risk trade can be considered to be back on a bit.”

The index’s 4.7 percent retreat this month through yesterday was the second-smallest among major developed-market stock benchmarks behind New Zealand’s. A 10 percent jump in S&P/TSX gold stocks mostly canceled out the impact of a 9.9 percent plunge in energy-company shares as precious metals rose on concern that the global recovery is slowing.

Economists had forecast a 2 percent increase in U.S. durable-goods orders, according to the median of 81 estimates in a Bloomberg survey.

Royal Bank, TD

Bank stocks gained 1.8 percent after surging 3.8 percent yesterday to complete their biggest two-day advance since May 2009.

Royal Bank advanced 2.4 percent to C$51.28. Toronto- Dominion Bank, its largest domestic rival, increased 2.4 percent to C$75.07. Bank of Nova Scotia (BNS), the country’s third-biggest lender by assets, climbed 1.7 percent to C$52.32.

Gold futures plunged $104 an ounce, or 5.6 percent. The futures had settled at a record $1,891.90 an ounce on Aug. 22.

Barrick declined 3.7 percent to C$48.25. Goldcorp Inc. (G), the world’s second-largest gold producer by market value, lost 4 percent to C$48.76.

Silver Wheaton Corp. (SLW), Canada’s fourth-biggest precious- metals company by market value, decreased 4.4 percent to C$36.67 as silver slumped 7.4 percent. Tahoe Resources Inc. (THO), which explores for silver in Guatemala, tumbled 12 percent, the most since it began trading in June 2010, to C$16.95.

Energy

S&P/TSX energy stocks rose to add to yesterday’s 3.9 percent gain.

Encana advanced 2.5 percent to C$24.89. Enbridge Inc. (ENB), Canada’s largest pipeline company, increased 1.5 percent to C$31.99. Tourmaline Oil Corp. (TOU), which produces natural gas and oil in western Canada, rallied 4.9 percent to C$32.05. PetroBakken Energy Ltd. (PBN), another western Canadian oil and gas company, jumped 6.2 percent to C$11.15 after CNBC discussed the Bakken oil formation.

West Fraser Timber Co., Canada’s largest forestry company, climbed 5.9 percent to C$42.29 after the U.S. reported the biggest monthly increase in home prices since 2005. Sino-Forest Corp. (TRE), the forestry company fighting a short seller’s assertions of financial manipulation, rose 13 percent to C$5.10 after slumping 14 percent in the previous two days.

BlackBerry maker Research In Motion Ltd. (RIM) gained 3.9 percent to C$28.25. The company will release smartphones that can run programs built for Google Inc.’s Android operation system next year, according to three people familiar with the plan. The people declined to be identified because the plans aren’t public.

Potash Corp. of Saskatchewan Inc., the world’s biggest fertilizer producer by market value, advanced 1.7 percent to C$54.70 as dry weather persisted in the U.S. Midwest. If drought continues into September and October, wheat prices may jump 50 percent, Dan Manternach, a wheat economist at Doane Advisory Services in St. Louis, said in a telephone interview.

Viterra Inc. (VT), Canada’s largest grain handler, increased 5.3 percent to C$10.49.

To contact the reporter on this story: Matt Walcoff at Mwalcoff1@bloomberg.net

To contact the editor responsible for this story: Nick Baker at Nbaker7@bloomberg.net

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