Canadian Stocks Rise as U.S. Oil Supplies Drop Most Since ‘01

Canadian stocks rose for a second day, led by energy producers, after the U.S. reported the biggest weekly drop in oil inventories since 2001.

Canadian Natural Resources Ltd. (CNQ), the country’s second- largest energy company by market value, gained 1.4 percent. Goldcorp Inc. (G), the world’s second-biggest gold producer by market value, lost 1.7 percent as the metal retreated. BlackBerry maker Research In Motion Ltd. (RIM) surged 9.8 percent after Reuters reported the company has declined “takeover overtures” from companies including Amazon.com Inc.

The oil-inventory report it “an indication that consumption is stronger than what everyone expected,” Tony Demarin, chief investment officer of BCV Asset Management in Winnipeg, Manitoba, said in a telephone interview. The firm oversees about C$300 million ($293 million). “Why else would oil inventories go down? The economy is doing better than people are giving credit for,”

The Standard & Poor’s/TSX Composite Index advanced 36.65 points, or 0.3 percent, to 11,753.53.

The index has slipped 13 percent in 2011 after surging 50 percent in the previous two years as economists have cut global growth forecasts due in part to the European debt crisis. Energy and raw-materials companies, which make up 48 percent of Canadian stocks (SPTSX) by market value according to data compiled by Bloomberg, have led the declines.

Inventory Plunge

The S&P/TSX Energy Index climbed as crude oil rose for a third day after the U.S. reported almost five times the drop in inventories that analysts had forecast, according to the median estimate in a Bloomberg survey.

Canadian Natural increased 1.4 percent to C$36.75. Nexen Inc. (NXY), an oil and gas producer with operations on five continents, rallied 4.6 percent to C$15.98. TransCanada Corp. (TRP), the owner of the country’s biggest pipelines system, rose 1.4 percent to C$44.33.

Corridor Resources Inc. (CDH), which explores for oil and gas in eastern Canada, sank 38 percent, the most in 11 years, to C$1.13 after saying it has been unable to find a joint-venture partner for its shale-gas prospect in New Brunswick.

The U.S. Dollar Index climbed after the European Commission estimated that consumer confidence in the region fell to the lowest since August 2009 and Swiss Finance Minister Eveline Widmer-Schlumpf said the country is considering capital controls to weaken the franc.

Mining Shares

Raw-materials stocks in the S&P/TSX dropped. Goldcorp declined 1.7 percent to C$46.10. First Quantum Minerals Ltd. (FM), the country’s second-largest publicly traded copper producer, slipped 1.5 percent to C$18.81. San Gold Corp., which mines in Manitoba, slumped 7.7 percent to C$1.79 after soaring 41 percent yesterday on drilling results.

Banro Corp., which is developing gold projects in Africa, rallied 8.1 percent to C$3.60 after saying the Twangiza mine in the Democratic Republic of the Congo is on schedule for full production in the first quarter.

The S&P/TSX Telecommunications Services Index rose to the highest since January 2008 a day after a person familiar with the discussions said Globalive Communications Corp., the owner of Wind Mobile, is in talks to buy fellow carrier Mobilicity. Both companies are closely held.

A decline in competitors would benefit other industry companies, Phillip Huang, an analyst at UBS, said in a note to clients dated yesterday.

BCE, Telus

Rogers Communications Inc. (RCI/B), the country’s biggest wireless carrier, gained 0.9 percent to C$38.60. BCE Inc. (BCE), Canada’s largest phone company, advanced 1.3 percent to C$41.26, the highest close since July 2007. Telus Corp. (T), the country’s No. 3 wireless carrier, increased 1 percent to C$57, the highest since October 2007.

RIM jumped 9.8 percent to C$14.17 after closing at the lowest since December 2003 yesterday. Reuters cited unnamed people familiar with the situation in its report that Amazon is among companies that have approached the Waterloo, Ontario-based company about a potential takeover bid.

Microsoft Corp. and Nokia Oyj have considered making a joint bid for RIM, the Wall Street Journal said today, citing unnamed people familiar with the matter. Representatives of RIM, Amazon, Microsoft and Nokia declined to comment on the reports.

RIM shares tumbled 78 percent this year through yesterday as the company lost smartphone market share to Apple Inc. and phones using Google Inc.’s Android operating system.

Open Text Corp. (OTC), Canada’s largest software company, slumped 5.4 percent to C$51.25 after Oracle Corp. reported second- quarter earnings below the average analyst estimate in a Bloomberg survey.

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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