Canadian stocks gained for a second day as precious metal prices continued to rise on speculation that government and central bank stimulus policies will weaken currencies.
Barrick Gold Corp., the world’s largest gold producer, rose 1.9 percent as the U.S. dollar decreased from an eight-month low. Research In Motion Ltd., the BlackBerry maker, dropped 4.2 percent after losing ground in a survey of U.S. smartphone market share. Teck Resources Ltd., Canada’s biggest base-metals and coal producer, advanced 0.7 percent as copper and zinc rallied.
The Standard & Poor’s/TSX Composite Index climbed 3.72 points, or less than 0.1 percent, to 12,501.72, extending a two-year high.
“People are very worried about the U.S. dollar, and the more they get worried, the more they seem to like gold,” said Doug Davis, chief executive officer of Davis-Rea Ltd. in Toronto, which manages about C$400 million ($396 million). “People want to be in something that’s safe and sure rather than the weak currencies.”
The equity benchmark soared 13 percent in the three months ending yesterday thanks to a 25 percent surge in its raw-materials stocks. Gold prices jumped 11 percent during the period as investors contemplated a new round of central-bank stimulus policies to recharge the economy.
Gold futures rose 0.6 percent to $1,347.70 an ounce in New York, another record.
Barrick gained 1.9 percent to C$49.08. Goldcorp Inc., the world’s second-largest producer of the metal by market value, advanced 2 percent to C$45.74. Crocodile Gold Corp., which mines in Australia, soared 29 percent to C$1.51 after announcing a production increase.
Silver Standard Resources Inc., which explores for the metal in North America, South America and Australia, soared 6.7 percent, the most this year, to C$22.66 after releasing drilling results from its Brucejack project in British Columbia.
An index of S&P/TSX base-metals and coal producers added to its gains after rallying to the highest level in 22 years of Bloomberg data yesterday. Copper climbed to its highest price in nearly 27 months after Morgan Stanley raised its price estimates on the industrial metal.
Teck rose 0.7 percent to C$44.37 after jumping 4.1 percent yesterday. Copper and molybdenum producer Taseko Mines Ltd. gained 5.6 percent to C$6.07. Inmet Mining Corp., which produces gold, zinc and copper, advanced 2.3 percent to C$60.04.
The S&P/TSX Banks Index climbed to a four-month high after the Richard Ivey School of Business reported Canadian business and government spending increased to a four-year high last month. Most economists in a Bloomberg survey had expected a decline from August.
Bank of Montreal, Canada’s fourth-largest bank, rose 0.9 percent to C$60.11. National Bank of Canada, the No. 6 lender by assets, gained 0.9 percent to C$65.42. Royal Bank of Canada, the country’s biggest company by market value, advanced for a fourth day, increasing 0.6 percent to C$55.
RIM decreased 4.2 percent to $48.47 after market-research firm comScore Inc. said its share of the U.S. smartphone market slumped to 38 percent from 42 percent in May. Only Google Inc.’s Android operating system gained share among the top five smartphone platforms.
Potash Corp. of Saskatchewan Inc, the world’s largest fertilizer producer, retreated 1.4 percent to C$143.30. Bill Boyd, Saskatchewan’s energy and resources minister, said in a Bloomberg Television interview that BHP Billiton’s $40 billion bid for Potash Corp. doesn’t appear to be of “net benefit” to his province.
Canada’s federal government can block foreign takeovers if it finds they are not of “net benefit” to the country.
Air Canada, the country’s biggest airline, jumped 7.6 percent to C$3.11, the highest since November 2008, after saying September traffic increased 12 percent from a year earlier.
Ivanhoe Energy Inc., which is developing the Tamarack oil-sands project in Alberta, led the S&P/TSX with a 10 percent surge to C$2.38. The company yesterday announced what it called “encouraging” drilling results from a natural gas project in China.