March 20 (Bloomberg) -- Canadian stocks rose for the first time in three days as European policy makers weighed bailout options for Cyprus and the Federal Reserve maintained its stimulus efforts.
Oil producers Canadian Natural Resources Ltd. and Cenovus Energy Inc. each gained 1 percent after crude advanced the most in almost two weeks. BlackBerry climbed 7.2 percent as an analyst at Morgan Stanley raised his rating on the smartphone maker’s stock. Valeant Pharmaceuticals International Inc. added 2.5 percent after agreeing to buy Obagi Medical Products Inc. for about C$360 million ($351 million).
The Standard & Poor’s/TSX Composite Index rose 52.68 points, or 0.4 percent, to 12,826.55 at 4 p.m. in Toronto. The S&P/TSX has risen 3.2 percent this year. Trading volume was in line with the 30-day average.
“There’s a return to confidence in all markets, whether it be equity markets or commodity markets,” said Anish Chopra, managing director and fund manager with TD Asset Management Ltd., from Toronto. His firm oversees about C$204 billion. “People are dealing with the issues in Cyprus and looking at the alternatives, and the U.S. economy is doing well under the circumstances.”
The Fed will keep up its bond buying at a pace of $85 billion a month even as the world’s largest economy and the job market pick up, the Federal Open Market Committee said today at the conclusion of a two-day meeting in Washington. The purchases will continue until “the outlook for the labor market has improved substantially in a context of price stability.”
The central bank also left unchanged its statement that it plans to hold its target interest rate near zero as long as unemployment remains above 6.5 percent and inflation is projected to be no more than 2.5 percent.
“The Fed is staying the course, looking for sustained economic growth before they take away stimulus,” Chopra said.
Oil climbed as much as 1.1 percent after Luxembourg’s Luc Frieden called for fellow euro-area finance ministers to assemble a new rescue package for Cyprus to avoid an implosion of its banking sector. The island nation yesterday rejected an unprecedented levy on bank deposits, causing crude futures to tumble the most in a month.
Oil for April delivery advanced 0.9 percent to settle at $92.96 a barrel, maintaining its gains after the U.S. Energy Information Administration said stockpiles unexpectedly fell last week.
Energy stocks contributed most to gains in the S&P/TSX, adding 0.4 percent as a group. All 10 industries in the benchmark index advanced. Canadian Natural Resources rose 1 percent to C$33.62 and Cenovus increased 1 percent to C$32.67.
BlackBerry, formerly Research In Motion Ltd., jumped 7.2 percent to C$16.53, the highest since Feb. 7. Ehud Gelblum, analyst with Morgan Stanley, raised his rating for the stock to the equivalent of a buy and increased his price target to $22 from $10, saying BlackBerry’s new line of phones will boost profit margins.
Valeant gained 2.5 percent to C$75.21 for its highest close in 10 years, after agreeing to pay $19.75 a share in cash for Obagi, which makes skin-care creams. Valeant expects the deal to add to its cash earnings immediately.
Franco-Nevada Corp., the mineral royalties and investment company, slumped 4.3 percent to C$45.38 after yesterday reporting fourth-quarter adjusted earnings of 32 cents a share. That was short of the average estimate of 34 cents based on a survey of 10 analysts by Bloomberg.
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