Aug. 22 (Bloomberg) -- Canadian stocks rose the most in two weeks, as metal producers advanced after a purchasing manager’s index in China showed manufacturing unexpectedly expanded this month.
Miners Teck Resources Ltd. and First Quantum Minerals Ltd. jumped at least 3.8 percent as copper rallied. Barrick Gold Corp. added 3.1 percent after agreeing to sell three of its mines in Australia for $300 million. Suncor Energy Inc. advanced 1.5 percent as crude climbed from a two-week low. WesternZagros Resources Ltd. plunged 27 percent after reporting disappointing results from a test well.
The Standard & Poor’s/TSX Composite Index rose 101.27 points, or 0.8 percent, to 12,674.35 at 4 p.m. in Toronto, the biggest gain since Aug. 8. The index has advanced 1.5 percent in August. Trading volume was 5.5 percent lower than the 30-day average at this time of the day.
The report from China “is indicative of a soft landing,” said Bob Decker, a fund manager with Aurion Capital Management in Toronto. The firm manages about C$6 billion ($5.7 billion). “We still need more data from China. It’s too early to call the end of the slowdown just yet.”
A factory index released today showed Chinese manufacturing resumed expansion this month after shrinking the most in almost a year in July. Growth in the world’s second-biggest economy has been slowing in recent quarters. China is Canada’s No. 2 trading partner and the largest consumer of metals and energy.
“This is good news for resource markets,” said David Rosenberg, chief economist and strategist with Gluskin Sheff & Associates Inc., in a note to clients today.
Raw-materials producers increased 2.3 percent, the most in the S&P/TSX as nine of 10 industries advanced.
Teck Resources, Canada’s largest diversified miner, jumped 3.8 percent to C$27.29 and First Quantum Minerals rallied 5 percent to C$18.58. Copper rallied 0.7 percent in New York, and nickel, tin and zinc prices advanced in London.
Barrick Gold, the world’s largest producer of the metal, rose 3.1 percent to C$20.57 after agreeing to the $300 million deal with Gold Fields Ltd. The move is part of Barrick’s plan to sell assets and cut costs to offset a drop in the price of gold, which plunged in April by the most in three decades.
Kinross Gold Corp. increased 3.1 percent to C$5.97 and Torex Gold Resources Inc. surged 6.3 percent to C$1.70 as the price of the metal for December delivery climbed for the second time in three days.
Suncor Energy added 1.5 percent to C$35.38 and BlackPearl Resources Inc. surged 8.5 percent to C$2.05. The S&P/TSX Energy Index advanced 0.5 percent as crude rebounded after falling yesterday to the lowest level since Aug. 8.
Bombardier Inc. gained 2.8 percent to C$4.70, snapping three days of losses. Canadian Pacific Railway Ltd. advanced 3.6 percent to C$128.33, for the largest increase in three months, as the S&P/TSX Industrials Index rallied 1.5 percent for the first increase in four days.
WesternZagros Resources plunged 27 percent to C$1.10, the most since May 2010. Tests of the Kurdamir-3 well in Iraq’s Kurdistan region resulted in non-commercial flow rates, WesternZagros said in a statement yesterday.
“There was disappointment over one of their major wells,” Aurion’s Decker said. “It’s a one-hit wonder: if this play works out the stock is a home run, but it’s a very high risk.”
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