Sun Life Financial Inc. rose to the highest since October on speculation Federal Reserve easing measures will boost global equities, bolstering Canada’s third-largest insurer’s earnings.
The stock rose as much as 5.59 percent in Toronto today, the largest intraday increase since April 12, to C$24.95, the highest since April 19. The Toronto-based company is up 32 percent this year.
The Standard & Poor’s/TSX Composite Index added 139.99 points, or 1.1 percent, to 12,500.15 at 3:20 p.m. in Toronto. U.S. Federal Reserve Chairman Ben S. Bernanke said yesterday the central bank will spend more than $40 billion per month on mortgage bond purchases to spur growth.
“It all comes down to the actions the Fed,” said Peter Routledge, Financial Analyst at National Bank of Canada. Yesterday’s announcement will spur equity gains, he said.
“While this is good for all life companies, it is particularly good for Sun Life,” Routledge said, citing the company’s U.S. unit MFS Investment Management.
Insurers are helped by rising equities because they increase investment income.