Canadian stocks rose to the highest in four months, as raw-material producers climbed after gold surged the most in a year and industrial metals rallied.
Metals miners accounted for all 10 of the biggest gains in the Standard & Poor’s/TSX Composite Index. Eldorado Gold Corp. surged 9.6 percent as analysts at JPMorgan Chase & Co. recommended buying the shares. Barrick Gold Corp., the world’s largest producer of the precious metal, added 6.2 percent. Financial stocks gained for a fourth day, with Royal Bank of Canada advancing 0.9 percent to stretch its winning streak to eight days.
The S&P/TSX rose 73.25 points, or 0.6 percent, to 12,758.38 at 4 p.m. in Toronto. The benchmark gauge has rallied 1.9 percent during a four-day winning streak to the highest since March 20. Trading volume was 9.3 percent below the 30-day average.
“These big jumps in financials and positive moves in the commodities may be enough to get people on the sidelines wanting to get back in,” Barry Schwartz, fund manager with Baskin Financial Services Inc. in Toronto, said in a phone interview. He helps manage about C$500 million ($484 million). “This may be the beginning of the bear in the Canadian market going back into his cave to hibernate.”
The S&P/TSX has advanced 7.8 percent since June 24, rebounding from a 7.2 percent rout that started May 22. The gauge is up 2.6 percent for the year.
Eight of the ten industries in the S&P/TSX advanced, led by a 3.8 percent surge among producers of raw materials. The S&P/TSX Materials Index is down 26 percent this year, even after a 13 percent surge in the past month,
Gold advanced 3.3 percent today, the biggest gain since June 2012, to settle at $1,337.30 an ounce as speculation the Federal Reserve will maintain stimulus spurred demand for the metal. Silver rallied 5.4 percent, the most since April 25. Copper rose for a third day. Aluminum, lead, nickel, tin and zinc also gained.
Eldorado Gold jumped 9.6 percent to C$8.11, the highest in seven weeks, after JPMorgan analyst John Bridges rated the stock “overweight” in new coverage. Barrick Gold climbed 6.2 percent to C$17.56.
Banks, brokerages and insurers in the S&P/TSX climbed 0.4 percent as a group, extending a gain of 2.7 percent gain from last week.
Royal Bank of Canada, the nation’s largest lender by assets, gained 0.9 percent to a record C$65.56. The stock has advanced 12 of the past 13 sessions for a 8.4 percent jump.
Telephone stocks declined the most in the index, falling 2.4 percent. Telus Corp. lost 3.1 percent to C$30.65 and Rogers Communications Inc. dropped 2.2 percent to C$41.15.