Canada Stocks Rise as Financial Shares Offset U.S. Payroll Data

Canadian stocks rose for a second day, after the benchmark index sank to the lowest level of the year this week, as a rally in energy and financial shares offset data showing U.S. companies added fewer jobs than forecast.

Royal Bank of Canada and Toronto-Dominion Bank rose at least 0.5 percent. Silver Standard Resources Inc. and Lundin Mining Corp. added more than 4.2 percent as precious metals prices advanced. Goldcorp Inc. lost 1.2 percent after agreeing to effectively freeze its hostile offer for Osisko Mining Corp. Advantage Oil & Gas Ltd. dropped 8.9 percent after ending its strategic review process.

The Standard & Poor’s/TSX Composite Index (SPTSX) increased 55.21 points, or 0.4 percent, to 13,559.69 at 4 p.m. in Toronto. The gauge has lost 1 percent this week. It has fallen 0.5 percent this year as the U.S. Federal Reserve pared stimulus and emerging-market currencies slumped amid signs China’s economy is slowing. Trading in S&P/TSX stocks was 16.3 percent higher than the 30-day average at the close.

“We’re still going through this consolidation correction where people are trying to figure out if tapering is going to accelerate or if growth expectations are too high,” Jeff Young, chief investment officer at NexGen Financial Corp., said in a phone interview. The Toronto-based firm manages about C$900 million ($811 million). “Friday’s jobs data is the next big point on the economic scene.”

Payrolls Data

Colder-than-normal weather limited progress in the U.S. job market as payrolls increased by 175,000, according to the ADP Research Institute in Roseland, New Jersey. The median projection of 40 economists surveyed by Bloomberg called for an advance of 185,000. Canada and the U.S. will both report employment data on Friday.

Another report showed Canadian building permits fell for a second month in December as multiple-unit housing projects dropped to the lowest level in nine months. The value of domestic municipal permits fell 4.1 percent to C$6.48 billion ($5.86 billion), following a 6.6 percent decline in November, Statistics Canada said today in Ottawa. Economists forecast a 1.5 percent gain according to the median of eight responses to a Bloomberg survey.

Six of 10 main industries in the S&P/TSX rose. Financial shares gained 0.9 percent. Royal Bank of Canada climbed 1.5 percent to C$69.08 and Toronto-Dominion increased 0.5 percent to C$47.86.

Energy Companies

Energy shares gained 0.8 percent. TransGlobe Energy Corp. climbed 4.3 percent to C$7.82 and Penn West Petroleum Ltd. jumped 4 percent to C$8.52. Peyto Exploration & Development Corp. rose 3.8 percent to C$33.34.

Silver Standard jumped 6.4 percent to C$8.93 and Lundin increased 4.2 percent to C$4.96. Alacer Gold Corp. increased 3 percent to C$2.38.

Gold futures rose 0.5 percent after the U.S. payrolls report boosted demand for the metal as a store of value. The price of silver jumped 2 percent.

Goldcorp decreased 1.2 percent to C$27.48, reversing an earlier rally of as much as 2.3 percent. The Vancouver-based gold producer won’t take up and pay for any Osisko shares tendered to its bid before a judgment on a lawsuit filed by Osisko to block the takeover, Goldcorp said in a statement. Goldcorp extended the deadline of the offer to March 10 from Feb. 19.

A trial will be held from March 3 to March 5 at the Quebec Superior Court, Montreal-based Osisko said yesterday in a statement. Osisko said Goldcorp misused confidential data in making its cash-and-stock bid. Goldcorp, the world’s second-largest gold producer by market value, denies the allegations. Osisko fell 0.9 percent to C$6.53.

Advantage Oil & Gas slumped 8.9 percent, the biggest drop since September 2011, to C$4. The Calgary-based company didn’t get an acceptable offer after receiving expressions of interest on potential transactions, according to a statement.

Advantage also sold its shares in Longview Oil Corp. Longview fell 1.8 percent to C$4.37, an all-time low.

Atlantic Power Corp. slumped 3.8 percent to C$2.52, extending a four-day losing streak to 28 percent. Moody’s Investors Service downgraded the energy producer’s corporate family rating to B2 from B1 this week, citing high leverage.

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

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

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