Canadian stocks rebounded from a five-month low as crude oil and gold prices climbed and U.S. jobless claims held steady, signaling the labor market is stabilizing.
Kinross Gold Corp. and Alamos Gold Inc. advanced at least 5.9 percent, while Bankers Petroleum Inc. and Legacy Oil + Gas Inc. jumped more than 4.5 percent. Toronto-Dominion Bank and Royal Bank of Canada, the nation’s largest lenders, paced losses in financial shares. TransCanada Corp. gained 1.1 percent after the U.S. State Department said it will post all public comments on its review of the proposed Keystone XL pipeline, reversing an earlier decision.
The Standard & Poor’s/TSX Composite Index rose 49.05 points, or 0.4 percent, to 11,996.34 at 4 p.m. in Toronto, erasing earlier losses of as much as 0.2 percent. The benchmark equity gauge has fallen 3.5 percent this year.
“The labor market continues to hold steady,” Brian Huen, managing partner with Red Sky Capital Management Ltd., said on the phone from Toronto. He helps manage C$55 million ($54 million). “If the recovery fizzles a little bit QE might last longer, which can be seen as a positive. For right now, we’re staying on course that the U.S. economy is recovering.”
Applications for U.S. jobless insurance payments increased by 4,000 to 352,000 in the week ended April 13, in line with the median forecast of economists surveyed by Bloomberg.
Some policy makers with the U.S. Federal Reserve favor pulling back this year on $85 billion in monthly debt-buying, or quantitative easing, as the U.S. economy recovers.
Kinross added 5.9 percent to C$5.43 and Alamos Gold surged 6.5 percent to C$11.16 as gold for June delivery rose 0.7 percent to settle at $1,392.50 an ounce in New York. Gold retail sales tripled across China from April 15 to April 16, the China Gold Association said. Gold prices have slumped 17 percent this year.
Raw-materials producers contributed most to gains in the S&P/TSX, rising 2.3 percent as a group as six of 10 industries advanced. Trading volume was 11 percent higher than the 30-day average.
TD Bank lost 1 percent to C$80 and Royal Bank decreased 0.6 percent to C$61.03 as the S&P/TSX Financials Index fell for a second day.
The Bank of Canada yesterday cut the nation’s growth outlook for 2013 to 1.5 percent from 2 percent and said “economic slack” will persist for more than two years.
TransCanada, which is attempting to build the Keystone XL pipeline in the U.S., rose 1.1 percent to C$48.84 after the U.S. State Department said it will release comments on its review of the proposed project.
The department will also provide additional chances for comment during the National Interest Determination period. The pipeline would help bring Alberta’s oil sands to refineries on the U.S. Gulf Coast.
Joe Oliver, Canada’s natural resources minister, said in Calgary today he is cautiously optimistic the pipeline will be approved and will reach out to government officials and Democratic and Republican lawmakers to lobby for the project when he visits Washington next week.
Bankers Petroleum surged 8.4 percent to C$2.46 and Legacy Oil + Gas gained 4.7 percent to C$5.17. Crude for May delivery advanced 1.2 percent to settle at $87.73 a barrel in New York, the biggest gain since March 26.
Ivanplats Ltd. rose 0.3 percent to C$2.97, paring earlier gains of as much as 7.8 percent after the company said planned development of its Kamoa copper project in the Democratic Republic of Congo will not be affected by a ban on exports of cobalt and copper concentrates announced by the country yesterday.
Ivanplats, based in Vancouver, said its development plans include a smelter that will produce upgraded product, meeting the government’s demands that mining companies add value to the commodities before shipping them.