Canadian Stocks Rise for Sixth Week as Mining Stocks Advance

Canadian stocks rose, extending a sixth-straight weekly advance, after borrowing costs fell at an Italian debt sale and the U.S. dollar declined for a fifth day against the euro.

Barrick Gold Corp. (ABX), the world’s largest gold producer, gained 1.1 percent as the metal climbed to a seven-week high. Toronto-Dominion Bank (TD), Canada’s second-biggest lender by assets, dropped 0.9 percent as financial stocks declined for a fourth day. Potash Corp. of Saskatchewan Inc., the world’s largest fertilizer producer by market value, rallied 3.4 percent after an analyst at National Bank of Canada (NA) boosted his rating on the shares.

The S&P/TSX Composite Index (SPTSX) gained 2.18 points, or less than 0.1 percent, to 12,466.50, extending its weekly advance to 0.6 percent.

“The euro has come under so much pressure in the past few months, and indications out of Europe have turned a little more constructive,” Andrew Pyle, an associate portfolio manager at Bank of Nova Scotia in Peterborough, Ontario, said in a telephone interview. Pyle’s team oversees about C$200 million ($200 million). “Maybe the euro has found a bottom against the U.S. dollar, and that would help support gold.”

The index’s streak of weekly gains is the longest since April 2009. Gold stocks rallied this week after the U.S. Federal Reserve said it plans to keep interest rates at historical lows until at least late 2014 and the U.S. dollar retreated. Raw- materials companies make up 21 percent of Canadian equities by market value, according to Bloomberg data.

Italian Debt Sale

Italy’s Treasury sold 8 billion euros ($10.5 billion) of 182-day bills today at the lowest yields since May. It also sold 3 billion euros of 331-day bills. The U.S. dollar fell for a fifth day against the euro.

The S&P/TSX Gold Index (STGOLD) completed its biggest weekly rally since October. Barrick Gold Corp., the world’s largest producer of the metal, increased 1.1 percent to C$49.51. Eldorado Gold Corp. (ELD), Canada’s fifth-biggest company in the industry by market value, climbed 6.5 percent to C$15.07.

Premier Gold Mines Ltd. (PG), which said yesterday it intends to enter a joint venture with Newmont Mining Corp. in Nevada, jumped 12 percent to C$5.95. Christos Doulis, an analyst at Stonecap Securities Inc., raised his 12-month price estimate on the shares to C$8.85 from C$8.50, citing the joint venture in a note to clients.

Potash Corp. Upgrade

Potash Corp. gained 3.4 percent to C$47.54 after Robert B. Winslow, an analyst at National Bank, boosted his rating on the shares to “sector perform” from “underperform.” Winslow raised his earnings estimates for the company, citing “the potential for near-term upward pressure on grain prices” in a note to clients.

Financial stocks in the S&P/TSX fell after the U.S. said its gross domestic product increased at an annualized rate of 2.8 percent in the fourth quarter. Economists had forecast a 3 percent increase in GDP, according to the median estimate in a Bloomberg survey.

TD dropped 0.9 percent to C$77.15. Royal Bank of Canada (RY), its larger domestic rival, slipped 0.7 percent to C$52.33. Bank of Montreal (BMO), the country’s fourth-biggest lender by assets, declined 0.7 percent to C$59.22.

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

To contact the editor responsible for this story: Michael P. Regan at mregan12@bloomberg.net

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