- S&P/TSX rebounds in final hour for first gain of 2nd quarter
- Valeant continues rebound from 2011 low, up 30% in two days
Canadian stocks rose, snapping a four-day retreat to open the second quarter, as energy producers rallied and Valeant Pharmaceuticals International Inc. surged to lead health-care companies higher.
The Standard & Poor’s/TSX Composite Index climbed 0.3 percent to 13,347.23 at 4 p.m. in Toronto, reversing losses in the final hour of trading to cap a see-saw day. The Canadian benchmark had lost 1.5 percent in the past four sessions, the longest losing stretch since February. The S&P/TSX is up 2.6 percent this year and remains one of the best-performing developed markets in the world.
Canadian equities joined a rebound in stocks worldwide today as crude prices surged. A gauge of global developed and developing markets added 0.8 percent. The S&P 500 rallied 1.1 percent in New York for the biggest gain in almost a month.
U.S. crude inventories unexpectedly dropped from the highest level in more than eight decades, according to government data. Futures jumped 5.2 percent in New York for the biggest increase in three weeks. Traders are also awaiting a key meeting of OPEC producers April 17 in Doha to discuss an output freeze. Kuwait said Tuesday a deal can still be reached even without Iran.
A first-quarter rally in the S&P/TSX has lost momentum to start the second quarter as volatility returned to commodities prices. The Canadian benchmark equity gauge now trades at 21.2 times earnings, about 13 percent higher than the 18.8 times earnings valuation of the S&P 500, according to data compiled by Bloomberg.
Downside risks to global markets have increased, ranging from terrorism to the U.K.’s potential departure from the European Union, at a time when growth is at best mediocre, International Monetary Fund Managing Director Christine Lagarde said yesterday in an interview with Bloomberg TV. “We don’t see much by way of upside,” she said.
Financial services firms in the benchmark index decreased 0.4 percent, led by losses in Toronto-Dominion Bank and Royal Bank of Canada. Metro Inc. tumbled 4.2 percent to lead consumer staples stocks lower after Desjardins Securities Inc. analyst Keith Howlett cut his rating for the stock to hold from buy.
Canadian Natural Resources Ltd. gained 4.8 percent, while Suncor Energy Inc. added 2.3 percent to pace a 2.3 percent increase among energy companies in the index, the steepest climb in a month.
S&P/TSX health-care stocks soared 13 percent, the most since December, spurred by a 19 percent increase for Valeant. The drugmaker has rebounded from a five-year low, increasing 30 percent in the last two days, after board member and billionaire investor Bill Ackman said the company’s search for a new chief executive officer may be coming to a close within the next few weeks.
Valeant said Tuesday a special “ad hoc” board committee found no additional accounting issues that would require more restatements and the company plans to file its annual report on or before April 29.