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Canadian Stocks Hit Two-Week High on U.S. GDP Expansion

Canadian stocks rose to the highest level in two weeks and extended their biggest weekly advance since July as data showed the U.S. economy expanded more than forecast last quarter.

OceanaGold Corp. and China Gold International Resources Corp. increased at least 1.5 percent as the metal’s price rebounded. BlackBerry Ltd. (BBRY) soared 16 percent after it struck a five-year deal with Foxconn Group to manufacture its devices. Martinrea International Inc. fell 5.8 percent, extending its losses for the week to 19 percent.

The Standard & Poor’s/TSX Composite Index (SPTSX) increased 7.40 points, or less than 0.1 percent, to 13,399.60 at 4 p.m. in Toronto. That’s the highest level for the benchmark since Dec. 2 as it capped a gain for the week of 2.1 percent. The index trimmed earlier gains of as much as 0.8 percent in the final half-hour. Trading of stocks in the index was 75 percent higher than the 30-day average.

“Stronger-than-expected U.S. GDP is a positive for Canada and more so a positive for cyclical stocks like energy, materials and financials,” Andrew Pyle, a fund manager at ScotiaMcLeod Inc. in Peterborough, Ontario, said in a phone interview. He manages C$220 million ($205.6 million). “Energy and materials are creeping up and they weigh heavily on the indexes.”

GDP Growth

U.S. gross domestic product climbed at a 4.1 percent annualized rate, the strongest since the final three months of 2011 and up from a previous estimate of 3.6 percent, Commerce Department figures showed. The median forecast of 72 economists surveyed by Bloomberg projected a 3.6 percent pace after 2.5 percent in the second quarter.

Canada’s consumer price index rose 0.9 percent in November from a year ago following a 0.7 percent rise the prior month, Statistics Canada said today. The result trailed the 1 percent median forecast in a Bloomberg survey in November. The core rate, which excludes eight volatile products, slowed to 1.1 percent from the 1.2 percent pace in October.

Gold prices gained 0.8 percent to $1,203.70 an ounce, after the precious metal tumbled 3.4 percent yesterday to the lowest settlement since August 2010. Gold, down 29 percent this year, is heading for its first annual decline since 2000.

Producers of raw materials in the S&P/TSX rose 0.5 percent. OceanaGold jumped 4.8 percent to C$1.54 and China Gold increased 1.5 percent to C$2.74 Canadian cents. The S&P/TSX Gold Index rose 0.3 percent.

Foxconn Deal

BlackBerry soared 16 percent, the biggest gain since November 2012, to C$7.74. Foxconn will make products for BlackBerry at plants in Indonesia and Mexico, according to a statement today. BlackBerry will own all of its intellectual property and handle quality assurance through Foxconn, an Apple Inc. (AAPL) supplier and the world’s largest manufacturer of electronic products.

The Canadian smartphone maker also reported a 56 percent drop in third-quarter sales to $1.19 billion, missing analysts’ estimates of $1.59 billion.

Methanex Corp. rose 2.8 percent to C$61.80. Raymond James Financial Inc. analyst Steven Hansen boosted the methanol producer’s rating to outperform from market perform.

Martinrea fell 5.8 percent to C$7.05, the lowest level since November 2012. Canada’s third-largest auto parts maker by market value slumped 21 percent yesterday after it warned one of its factories had misreported net income over eight years and said earnings would be lower than forecast.

To contact the reporter on this story: Callie Bost in New York at cbost2@bloomberg.net

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

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