- S&P/TSX adds 0.8% in week to push July advance to 3.8%
- Celestica climbs most since January as outlook tops estimates
Canadian stocks edged higher to cap a fourth weekly advance, pushing the benchmark index to the highest level in a year, as investors weighed contrasting earnings from electronics company Celestica Inc. and lumber producer West Fraser Timber Co.
The S&P/TSX Composite Index climbed 0.2 percent to 14,600.66 at 4 p.m. in Toronto, the highest since July 17, 2015. The benchmark is up 12 percent in 2016, making Canadian stocks more expensive than their U.S. peers, with a price-earnings ratio of 22.4 for the S&P/TSX, about 11 percent higher than the S&P 500 Index.
Mining stocks have propelled Canada to the second-best performance among developed markets, trailing only New Zealand. The group has rallied for a 56 percent increase amid a rebound in gold prices, the best such performance in at least 30 years, according to data compiled by Bloomberg.
Financial services companies added 0.3 percent Friday, led by gains in insurers Manulife Financial Corp. and Sun Life Financial Inc. Industrials and consumer discretionary stocks also rose as eight of 10 industries in the S&P/TSX advanced.
Health-care stocks dropped 4.2 percent, the biggest laggard in the S&P/TSX. Valeant Pharmaceuticals International Inc. lost 6.2 percent after receiving a letter from the Food and Drug Administration over its application for an eye drop medication. Some deficiencies were found after an inspection of Valeant unit Bausch + Lomb’s manufacturing facility in Tampa, Florida.
Raw-materials producers ended the day flat, paring earlier losses. West Fraser Timber added 0.1 percent, after falling as much as 5.2 percent, as second-quarter earnings fell short of analysts’ estimates. Barrick Gold Corp. added 1.2 percent.
Celestica jumped 8.5 percent, the most since January, after the company reported a third-quarter revenue outlook ahead of estimates. The high end of its sales guidance also exceeded the highest analyst estimate.
Canadian retail sales advanced in May for a second month, rising 0.2 percent after a gain of 0.8 percent in April. Sales climbed at gas stations even as car sales declined. Combined with strong gains in January and February, retail sales this year are up 4.9 percent, the best start to a year in six years. The inflation rate was unchanged in June.