Canadian Stocks Rise as Bondholders Join Greek Debt Swap
Stock Chart for Royal Bank of Canada (RY)
Canadian stocks rose for the first time in four days, led by energy companies, as more bondholders joined a Greek debt swap.
Suncor Energy Inc. (SU), Canada’s biggest oil and gas producer, rose 1.4 percent as crude oil climbed after settling at a two- week low yesterday. Royal Bank of Canada (RY), the country’s largest lender by assets, dropped 1 percent after Statistics Canada said building permits plunged 12 percent in January.
The S&P/TSX Composite Index (SPTSX) rose 22.75 points, or 0.2 percent, to 12,321.38 at 2:22 p.m. Toronto time after falling as much as 0.5 percent earlier, before more investors joined the Greek debt swap.
“There’s a lot of blind optimism and hope on the part of the people that are trading this market,” Danielle Park, a money manager at Venable Park Investment Counsel Inc. in Barrie, Ontario, said in a telephone interview. The firm manages at least C$1 million ($1 million) each for more than 200 clients. “Each leg of news that comes out of the Greek deal, they have a euphoric blast.”
The S&P/TSX slumped 3.3 percent in the previous three days, led by raw-materials and energy companies. Resources stocks fell with the euro on concern not enough owners of Greek bonds would take part in a restructuring meant to avoid a national default. The industries make up 47 percent of Canadian stocks by market value, according to Bloomberg data.
Oil and metals rose after investors with 58 percent of Greek bonds eligible for the debt swap indicated they would participate. The country has set a minimum participation level of 75 percent for the transaction, which ends tomorrow.
Suncor gained 1.4 percent to C$33.80. Talisman Energy Inc. (TLM), which produces energy in North America, the North Sea and Indonesia, climbed 1.5 percent to C$13.21. TransCanada Corp. (TRP), the developer of the proposed Keystone XL pipeline, advanced 1.6 percent to C$43.67.
PetroBakken Energy Ltd. (PBN), a western Canadian oil and gas producer, surged 7.4 percent to C$16.15. The company reported cash flow per share that surpassed analysts’ estimates, reports from Bank of Montreal and Canaccord Financial Inc. said. Petrobank Energy & Resources Ltd. (PBG), which owns a majority stake in PetroBakken, rose 6 percent to C$14.98.
First Quantum Minerals Ltd. (FM), Canada’s second-largest publicly traded copper producer, lost 2.7 percent to C$20.05 to extend its four-day tumble to 14 percent. The company disclosed fourth-quarter earnings that lagged behind the average analyst estimate in a Bloomberg survey by 21 percent, excluding certain items. First Quantum has missed analysts’ average profit forecast for eight straight quarters.
The value of municipal building permits filed in January fell to C$6 billion, the lowest total in four months, Statistics Canada said today. The drop was almost four times the median forecast in a Bloomberg survey of economists.
Canada’s seven-largest lenders each retreated. Royal Bank decreased 1 percent to C$55.57. Bank of Nova Scotia, Canada’s third-biggest lender by assets, slipped 1 percent to C$52.44. Laurentian Bank of Canada, the country’s seventh-largest lender, dropped 1.6 percent to C$44.31 after first-quarter earnings excluding some items missed the average estimate in a Bloomberg survey of analysts.
Technology-patent owner Wi-LAN Inc. (WIN) jumped 7.4 percent to C$5.26 after increasing its quarterly dividend 20 percent to 3 Canadian cents a share. The stock declined to the lowest since December 2010 yesterday.
The shares’ surge reflected company executives’ confidence about Wi-LAN’s prospects on a conference call with analysts, including a forecast that revenue will double in five years, Dev Bhangui, an analyst at Fraser MacKenzie Ltd., said in a telephone interview.
Nordion Inc. (NDN), which produces medical sterilization products and isotopes, fell 6.7 percent, the most since January 2011, to C$9.49 after reporting first-quarter earnings that trailed the average analyst estimate in a Bloomberg survey by 14 percent, excluding certain items.
Propane distributor Superior Plus Corp. surged 6.2 percent to C$7.51 after Jason Granger, an analyst at BMO, raised his 12- month price estimate on the shares to C$7 from C$6. Granger cited the company’s efforts to increase profit margin.
Aecon Group Inc. (ARE), a Toronto-based construction company, jumped 6 percent to C$13.05 after analysts at Toronto-Dominion Bank, Paradigm Capital Inc. and Stonecap Securities Inc. boosted their share-price estimates. Aecon reported fourth-quarter earnings on March 5 that beat the average analyst estimate in a Bloomberg survey by 33 percent, excluding certain items.
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