Canadian stocks rallied, rebounding from last week’s slide, as U.S. home sales increased and investors speculated China and Europe will stimulate economic growth.
Royal Bank of Canada, Toronto-Dominion Bank (TD) and Bank of Nova Scotia increased more than 0.9 percent. Oil and gas producers Suncor Energy Inc. (SU) and Canadian Natural Resources Ltd. (CNQ) climbed at least 3.3 percent as natural gas futures rose. Westport Innovations Inc. (WPT) surged 10 percent. Niko Resources Ltd. (NKO) sank 1.4 percent after saying it will relinquish its interest in an Indian gas production block.
The Standard & Poor’s/TSX Composite Index (SPTSX) rose 171.14 points, or 1.5 percent, to 11,451.78 in Toronto, its biggest increase in over a month. The Canadian market was closed yesterday for the Victoria Day holiday.
“We’re seeing a snapback from oversold conditions,” Irwin Michael, a portfolio manager at ABC Funds in Toronto, said in a telephone interview. Michael’s firm oversees C$1 billion ($1 billion). “Things may not be as bad as what the market once thought. Any bit of good news can get a rally going.”
The benchmark gauge on May 18 completed a third straight weekly decline as concerns mounted that the Greek debt crisis, European elections and a slowing Chinese economy may curb demand for commodities. Energy and raw-materials companies account for 43 percent of Canadian stocks by market value, according to data compiled by Bloomberg.
Energy companies advanced today as natural gas rose near a four-month high on speculation that warmer-than-normal weather heading into June will help drive demand from power plants and trim a supply surplus.
Oil Producers Gain
Suncor Energy, Canada’s largest oil and gas producer, climbed 3.3 percent to C$28.30. Canadian Natural Resources, the country’s third-biggest energy company, increased 3.5 percent to C$31. Encana Corp. (ECA), Canada’s largest natural gas producer by volume, rose 4.8 percent to C$20.97.
Westport Innovations, a Vancouver-based maker of cryogenic fuel tanks, surged 10 percent, the second-biggest increase in the S&P/TSX, to C$26.88. The company said Volvo Group will begin North American sales in 2014 of a heavy-duty engine built with Westport technology.
Niko Resources, which produces oil and gas in South Asia, declined 1.4 percent to C$33.58 after sinking as much as 18 percent. The company said it will give up its portion of the D4 production block in the Orissa Basin offshore India, citing the size and risk associated with the project, as well as the current commercial environment in India.
Banks in the S&P/TSX snapped a five-day skid after the National Association of Realtors said sales of existing homes increased in April for the first time in three months, adding to signs the housing market is recovering. The China Securities Journal reported that the nation plans to speed up approval of infrastructure projects and allocate construction funding faster to improve growth.
Royal Bank of Canada (RY), the nation’s biggest lender, gained 0.9 percent to C$52.17. Toronto-Dominion Bank, Canada’s second- largest lender, rose 1.2 percent to C$77.83. Bank of Nova Scotia (BNS), the country’s third-largest lender, climbed 1 percent to C$51.62.
To contact the reporter on this story: Joseph Ciolli in New York at firstname.lastname@example.org
To contact the editor responsible for this story: Michael P. Regan at email@example.com