Canadian Stocks Rise on IMF Plan, U.S. Manufacturing Increase
Canadian stocks rose, led by energy and financial companies, as the International Monetary Fund proposed increasing funds to contain the European debt crisis and U.S. factory production climbed.
Suncor Energy Inc. (SU), Canada’s largest oil and gas producer, gained 2.2 percent as the IMF proposed as much as $500 billion more in lending capacity to help insulate the global economy. National Bank of Canada (NA) rallied 1.2 percent. BlackBerry maker Research In Motion Ltd. dropped 1.6 percent after Samsung Electronics Co. said it won’t buy the company. TransCanada Corp. (TRP), owner of the Keystone XL pipeline, fell 1.1 percent as the Obama administration rejected the project.
The S&P/TSX Composite Index (SPTSX) rose 94.69 points, or 0.8 percent, to 12,327.52 in Toronto.
“Efforts are at least under way to stabilize the European situation -- that’s encouraging,” Sal Guatieri, a senior economist at BMO Capital Markets in Toronto, said in a phone interview. “We are generally seeing positive economic numbers. The manufacturing increase was very strong and suggests that the U.S. economy is recovering.”
Factories in the U.S. churned out more computers, cars and construction material in December as manufacturing remained at the center of the expansion. Output climbed 0.9 percent last month, the biggest gain since December 2010, according to Federal Reserve data issued today in Washington.
The S&P/TSX climbed 0.2 percent in the two weeks ending yesterday as gains by base-metals producers and financial companies were offset by declines in energy stocks as natural gas prices plunged to a nine-year low. The S&P/TSX trailed the S&P 500 last year for the first time since 2003 as drops in commodity prices held back the Canadian stock benchmark gauge. Energy and raw-materials companies make up 47 percent of Canadian equities by market value, according to Bloomberg data.
Global stocks rose today as the International Monetary Fund proposed to boost its lending capacity. The Washington-based lender is aiming to increase its resources after identifying a potential need for $1 trillion in financing in coming years, an IMF spokesman said in a statement.
Greece is close to a deal with private creditors that would give them cash and securities with a market value of about 32 cents per euro of government debt, said Bruce Richards, who is on the creditors’ committee and chief executive officer for Marathon Asset Management LP.
S&P/TSX banks rose for the first time in four days after Goldman Sachs Group Inc., the fifth-largest U.S. bank by assets, beat analysts’ average earnings forecast in a Bloomberg survey by 50 percent. Royal Bank of Canada (RY), the country’s biggest lender by assets, gained 1.2 percent to C$52.45. Bank of Nova Scotia (BNS) rose 1.5 percent to C$52.56. National Bank of Canada gained 1.2 percent to C$73.95.
Oil and natural gas stocks in the S&P/TSX rose for a third day. Canadian Natural Resources Ltd. (CNQ), Canada’s second-largest energy company by market value, rose 2.7 percent to C$38.76.
Petrobakken Energy Ltd. (PBN) gained 6 percent to C$14.93. The company’s offering of the $750 million senior unsecured notes will replace $750 million in convertible debt, providing it with additional liquidity, Barclays Capital said in a note.
Petrobank Energy & Resources Ltd. (PBG), the majority owner of PetroBakken, advanced 6.4 percent to C$13.05, the highest price since Aug. 4. Suncor Energy rose 2.2 percent to C$33.94, the highest price since Aug. 3.
Bankers Petroleum Ltd. rallied 10 percent to C$5.20, the biggest increase in the S&P/TSX. Jamie Somerville, an analyst at Toronto-Dominion Bank, reiterated an “action list buy” rating on the stock, with a 12-month price estimate of C$11.50.
The gauge of base metals stocks in the S&P/TSX advanced for the third day. Teck Resources, Canada’s largest copper producer, rallied 2.7 percent to C$40.92, the highest price since Oct. 28. Thompson Creek Metals Co. rallied 8.1 percent to C$8.29, the highest price since Sept. 7.
Uranium One Inc. (UUU), a mining company controlled by Moscow- based ARMZ Uranium Holding, climbed 7.3 percent to C$2.79.
TransCanada fell 1.1 percent to C$41.89, the lowest price since Nov. 29. The Obama administration will let TransCanada submit a new application for an alternate pipeline route that avoids an environmentally sensitive area in Nebraska.
The gauge of industrial companies in the S&P/TSX rose to the highest level since July 25. Finning International Inc. (FTT) jumped 7 percent to C$26.10. The world’s largest dealer of Caterpillar Inc. equipment agreed to buy a distribution and support business from the U.S. manufacturer for about $465 million.
RIM lost 1.6 percent to C$17.47 after Samsung denied a report from the BGR blog that the Suwon, South Korea-based company is interested in buying RIM. (RIM) Shares of the Waterloo, Ontario-based smartphone maker rallied 5.3 percent yesterday.
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