Canada Stocks Rise as Raw-Materials Shares Gain on Ukraine Talks

Canadian stocks rose, extending a five-year high for the benchmark index, as gains among raw-material producers offset a decline in oil prices amid negotiations over the Ukraine crisis.

NovaGold Resources Inc. and Iamgold Corp. increased more than 2.2 percent to pace gains among gold companies. Avigilon Corp. jumped 5.8 percent after an analyst at Raymond James Ltd. raised his rating for the stock. TransGlobe Energy Corp. (TGL) sank 1.3 percent as net income slumped on writedowns.

The Standard & Poor’s/TSX Composite Index (SPTSX) rose 14.31 points, or 0.1 percent, to 14,304.17, the highest level since June 2008, at 4 p.m. in Toronto. The index has gained 5 percent this year.

“The environment we’re in right now is a mix, you can argue we’re recovering but we have also seen mixed economic data so the market is taking a pause to see which argument has more weight,” said Kash Pashootan, portfolio manager at First Avenue Advisory of Raymond James Ltd. in Ottawa. He manages about C$200 million ($181 million).

The Institute for Supply Management’s non-manufacturing index fell to 51.6 in February, the slowest pace in four years, reflecting a plunge in hiring that shows the biggest part of the U.S. economy is struggling with a combination of limited income gains and harsh weather impacting consumers. Readings greater than 50 indicate expansion.

The S&P/TSX jumped 0.5 percent yesterday after comments from Russian President Vladimir Putin spurred speculation that the Ukraine crisis won’t immediately worsen. U.S. Secretary of State John Kerry met Russian Foreign Minister Sergei Lavrov in Paris today to discuss the crisis. The U.S. has considered sanctions against Russia and aid to the government in Kiev.

Gold Shares

NovaGold climbed 6.4 percent to C$4.48 and Iamgold increased 2.2 percent to C$4.27. Gold futures rose 0.2 percent.

Sherritt International Corp. (S), which owns interests in nickel mines, jumped 6.5 percent to C$3.29 for a fourth gain in five days. Nickel advanced to a nine-month high in London, after China retained its goal for economic growth of 7.5 percent in 2014.

Avigilon, the surveillance equipment maker, rallied 5.8 percent to C$32.38, the biggest increase since November. Steven Li, analyst at Raymond James, raised his rating for the stock to outperform from market perform and increased his price target to C$35.

“We expect strong revenue growth to continue in 2014,” Li said in a note to clients. He forecasts a 57 percent increase in year-over-year sales as the company increases its sales force and introduces new products.

Torstar Corp. (TS/B), the print publishing company, surged 13 percent to C$5.67 after posting fourth-quarter revenue and adjusted earnings ahead of analyst projections.

Energy Industry

Lightstream Resources Ltd. declined 3.9 percent to C$5.67 to pace losses among energy stocks as six of 10 industries in the S&P/TSX retreated. Trading volume was 16 percent below the 30-day average.

TransGlobe Energy lost 1.3 percent to C$8.56. The company reported net income fell to $58.5 million last year, from $87.7 million a year earlier, as results were hurt by $30.1 million in impairment losses.

Cenovus Energy Inc. slipped 0.6 percent to C$29.12 as natural gas for March delivery fell 3.1 percent in New York.

Trican Well Service Ltd. slipped 2.9 percent to C$13.50 and Trilogy Energy Corp. retreated 2.5 percent to C$28.11 as crude for April delivery dropped 1.8 percent to $101.45 a barrel in New York.

Valeant Drops

Valeant Pharmaceuticals International Inc. lost 1.3 percent to C$160.08 to snap two days of gains. Health-care stocks dropped 1.3 percent, the most in the S&P/TSX.

Magna International Inc. fell 1.7 percent to C$104.94 to retreat from a record. The stock climbed 12 percent over the previous five days. The auto-parts maker posted better-than-forecast earnings on March 3.

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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