Canadian Stocks Advance as Crude Oil Surges to One-Month High

Canadian stocks rose from a one-week low, led by energy producers, as crude oil climbed amid optimism that economic growth will stabilize after Bank of America Corp. reported better-than-estimated earnings.

Suncor Energy Inc., Canada’s largest oil and gas producer, gained 2.8 percent as crude advanced to a one-month high. Canadian National Railway Co. (CNR), the country’s largest railroad, led industrials higher as it rose 3 percent. BlackBerry maker Research In Motion Ltd. climbed 3 percent after unveiling a new operating system.

The Standard & Poor’s/TSX Composite Index advanced 130.07 points, or 1.1 percent, to 12,053.11.

“The turnaround has been driven by the energy sector as crude has been creeping up around the prospect of double-dip recessions around the world being less likely,” Timothy Lazaris, chief executive officer of Red Sky Capital Management Ltd. in Toronto, said in a telephone interview. The firm oversees about C$55 million ($54.3 million).

The index declined 1.3 percent yesterday as metals and fuels retreated on concern European officials may not have a final plan to address the continent’s debt crisis this year. The S&P/TSX lost 16 percent from April 5 through yesterday as oil slumped 20 percent and copper sank 21 percent. Energy and raw- materials companies make up 48 percent of Canadian stocks by market value, according to Bloomberg data.

Bank’s Earnings

Bank of America Corp., this year’s worst performer in the Dow Jones Industrial Average, swung to a profit from a year- earlier loss on higher revenue, better credit quality and one- time gains, raising hopes that economic growth will stabilize.

The S&P/TSX Energy Index gained 2.4 percent as crude oil advanced. Suncor Energy Inc. (SU) jumped 2.8 percent to C$30.60. Canada’s largest oil and gas producer and its partners discovered oil in the Norwegian North Sea in the Butch prospect near the Ula field.

Canadian Natural Resources Ltd. (CNQ), the country’s second- biggest energy company by market value, advanced 2.3 percent to C$32.96.

Enbridge Inc. (ENB), Canada’s largest pipeline company, rallied 1.6 percent to C$34.90. TransCanada Corp. (TRP), the owner of Canada’s biggest pipeline system, rose 1.8 percent to C$43.63.

First to Recover

Canadian National Railway Co. led the S&P/TSX Industrials Index higher after Cormark Securities Inc. boosted the railway to “buy” from “market perform,” saying rails will be among the first industries to recover from the economic slowdown. Canadian National Railway gained 3 percent to C$74.65. Canadian Pacific Railway Ltd. (CP), Canada’s second-biggest railroad, rose 4.9 percent to $56.08.

Stocks fell earlier as precious and base metal producers declined on a report that China’s economy grew 9.1 percent in the third quarter from a year earlier, the slowest pace since 2009. The gain was less than the median estimate of 9.3 percent in a Bloomberg News survey of 22 economists and followed a 9.5 percent increase in the previous three months.

Barrick Gold Corp. (ABX) lost 1 percent to C$47.79. Goldcorp., the world’s second-biggest gold producer by market value, dropped 2.5 percent to C$47.05. Silver Wheaton Corp. (SLW), Canada’s fourth-largest precious-metals company by market value, slipped 3.4 percent to C$31.06.

Teck Resources Ltd. (TCK/B), the country’s biggest base-metals and coal producer, lost as much as 4.5 percent as copper futures fell before surging to close 1.9 percent higher at C$35.95.

Research In Motion

Research In Motion Ltd. (RIM) advanced 3 percent to C$23.59. The BlackBerry maker, looking to spur consumer interest in its devices after losing sales to Apple Inc. and Google Inc., unveiled a new operating system for its PlayBook tablet computer and new smartphones.

Niko Resources Ltd. (NKO) surged 8.5 percent, the second-most in the S&P/TSX Index, to C$50.21. The oil and gas producer with operations in South Asia was raised to “outperform” from “market perform” at Raymond James Ltd., which cited improved risks on reserves and exploration potential.

Industrial Alliance Insurance and Financial Services Inc. sank 4.9 percent, the most since July 2009, to C$30.65. The provider of insurance and retirement plans was cut to “hold” from “buy” at Desjardins Securities Inc., which cited the impact of the low-interest rate environment.

Lululemon Athletica Inc. (LLL) slumped 2.9 percent to C$52.11. The yoga-wear retailer was rated a new “neutral” at Macquarie Group Ltd, which gave a 12-month price estimate of $51 on the U.S. shares. Macquarie said competition is increasing and the stock is “pricey.”

To contact the reporter on this story: Kaitlyn Kiernan in New York at kkiernan2@bloomberg.net

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

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