Canada Stocks Rise as Crude Prices Bolster Oil, Gas Producers

Canadian stocks rose, following the third weekly drop for the benchmark index, as a nine-month high in the price of crude boosted oil and gas producers and existing home sales rose in May.

Calfrac Well Services Ltd. and Bankers Petroleum Ltd. (BNK) added at least 4.4 percent to pace gains among energy shares. Talisman Energy (TLM) Inc. increased 1.7 percent after Lundin Petroleum AB began drilling in a field co-owned by the two companies in the North Sea. B2Gold Corp. jumped the most in six weeks, ahead of its inclusion in an index of gold mining stocks. Rogers Communications Inc. rallied 1.3 percent after an analyst with Canaccord Genuity Inc. raised his rating for the stock.

The Standard & Poor’s/TSX Composite Index (SPTSX) rose 101.54 points, or 0.8 percent, to 12,288.90 at 4 p.m. in Toronto. The gauge slipped 1.5 percent last week and has lost 1.2 percent this year, making it the third-worst performing index among developed markets in the world, ahead of Austria and Hong Kong.

“We had a big shakeout in the market last week, so people are moving in after the weekend looking for bargains,” said Bob Decker, fund manager with Aurion Capital Management in Toronto. The firm manages C$6 billion ($5.9 billion). “Existing home sales are stabilizing, putting to rest some of the fears of a housing burst. The Canadian economy is pretty resilient. Crude is at a high and that doesn’t hurt either.”

Home Sales

Canadian existing home sales rose at their fastest pace in more than two years in May, adding to evidence the nation’s housing market remains robust. Home sales increased 3.6 percent in May from the previous month, the Canadian Real Estate Association said in a statement today, the biggest gain since January 2011.

Consumer-staples companies rose 2.2 percent as a group to a two-week high. Alimentation Couche Tard Inc. gained 4.3 percent to C$61.55, a record high, and Shoppers Drug Mart Corp. rose 1.9 percent to C$45.85.

Nine of 10 industries in the S&P/TSX advanced. Trading volume was 20 percent lower than the 30-day average at this time of the day.

Calfrac Well Services jumped 6.6 percent to C$31.41, the highest in a year, to pace gains among energy stocks, which rose 1.2 percent as a group. Dan MacDonald, analyst with RBC Capital Markets, raised Calfrac Well Services to an outperform rating, equivalent to a buy, and increased his price target to C$42 from C$30 due to an expected rise in gas licensing and drilling in British Columbia, he said in a note.

Bankers Petroleum rallied 4.4 percent to C$2.87 and Whitecap Resources Inc. added 3.7 percent to C$10.58.

Oil rose as much as 0.9 percent to $98.74 on renewed speculation that unrest in Syria will spread to other parts of the Middle East and disrupt supplies.

Talisman Energy rose 1.7 percent to C$11.84. Lundin Petroleum has begun drilling a development well on the Brynhild field in the North Sea. Lundin holds a 90 percent stake in the project, while Talisman holds a 10 percent rating.

B2Gold, a Canadian explorer and producer with assets in Latin America, Africa and Asia, soared 9.8 percent to C$2.46, the most since May 8. The Vancouver-based company is slated to join the NYSE Arca Gold Miners Index on June 21, Ian MacLean, a spokesman for B2Gold, said in a telephone interview with Bloomberg today.

Brookfield Asset Management Inc. increased 2.6 percent to C$36.89 after agreeing to sell its Longview Timber and Longview Fibre Paper and Packaging units in two separate deals worth a total $3.68 billion.

Rogers Communications, Canada’s largest wireless carrier, added 1.3 percent to C$45.95 after Dvai Ghose, head of research with Canaccord Genuity, raised the stock to a buy from a hold rating. There is a buying opportunity with Rogers slumping as much as 14 percent since reaching a high on April 10, Ghose said in a note to clients.

To contact the reporter on this story: Eric Lam in Toronto at elam87@bloomberg.net

To contact the editor responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net

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