Canadian Stocks Rise as Energy Shares Surge, RIM Rebounds
Canadian stocks rose as oil’s rally helped energy companies snap a two-day losing streak amid speculation central banks will take steps to bolster growth.
Energy stocks in the Standard & Poor’s/TSX Composite Index advanced 1.4 percent, the most in more than a week, as Encana Corp. (ECA) jumped 5.7 percent. Research In Motion Ltd. (RIM) advanced 5.3 percent, the biggest rally since March.
The S&P/TSX gained 58.48 points, or 0.5 percent, to 11,524.90, erasing a weekly loss and paring losses for the year to 3.6 percent. The benchmark gauge tumbled 6.3 percent in May, sinking to the lowest level since October during the month. Energy shares in the index slipped 11 percent this year through yesterday, while raw-material companies lost 9.1 percent.
“There’s been a substantial decline in energy prices, crude and natural gas,” Jamie Robertson, chief investment officer at McLean & Partners Wealth Management in Calgary, said in a phone interview. The firm manages C$900 million ($879 million). “Some people’s ears are perking up to the low prices.”
Policy makers from the U.K. to Japan and Canada stepped up warnings about the threat to world financial markets should Europe fail to contain its debt crisis, with speculation rising that they are prepared to act if Greek elections this weekend spark turmoil in the markets.
Energy producers in the S&P/TSX rose as oil prices advanced for a second day. The index trades for 15.6 times reported earnings, near the 2 1/2-year low of 14.9 reached earlier this month. Crude slumped to an eight-month low of $81.07 this week.
Research In Motion rallied 5.3 percent, the most since March 30, to C$11.17. The BlackBerry maker is down 25 percent this year, and fell yesterday after Nokia Oyj, another phone manufacturer that’s lost market share to Apple Inc. and Google Inc., reduced its earnings forecast and announced as many as 10,000 job cuts.
Raw-materials companies advanced as copper capped its first weekly gain since April. Teck Resources Ltd. (TCK/B), the nation’s biggest diversified mining company, advanced 1.2 percent to C$32.94. Potash Corp. of Saskatchewan Inc., the largest fertilizer producer, rose 1.3 percent to C$39.29, following two days of losses.
Finning International Inc. (FTT), a seller of Caterpillar Inc. equipment, rose 6.3 percent to C$24.18.
Gold stocks in the index defied the longest rally in gold futures in almost 10 months, dropping 0.4 percent. The metal climbed for a sixth straight day. San Gold Corp. (SGR) fell 14 percent to C$1.03, leading declines. Barrick Gold Corp. (ABX), the world’s largest provider, rose 1.1 percent to C$40.28.
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