Canadian Stocks Rise as Jobs Reports Bolster Energy, Gold Shares
Canadian stocks rose, sending the benchmark index to a 19-month high and its third straight weekly gain, as gold and energy shares advanced after better-than- forecast jobs data.
Semafo Inc. (SMF) and Iamgold Corp. climbed more than 5.5 percent as the price of gold rose for a second day. Niko Resources Ltd. (NKO) jumped 7.5 percent on news it received “significant” offers for some assets. Athabasca Oil Corp. and Encana Corp. advanced at least 1.6 percent as oil increased. SNC-Lavalin Group Inc. (SNC) fell 6.2 percent as Canada’s biggest engineering company forecast lower profit this year than analysts estimated.
The Standard & Poor’s/TSX Composite Index (SPTSX) rose 9.09 points, or 0.1 percent, to 12,835.61 at 4 p.m. in Toronto, the highest close since July 2011. The S&P/TSX added 0.5 percent this week. Trading volume was 6.8 percent higher than the 30-day average.
“The market liked the jobs numbers but didn’t get carried away,” said John Kinsey, fund manager with Caldwell Investment Management, who helps manage about C$1 billion ($972.1 million). “I think it confirms what we’ve been seeing out of the U.S., which is that the economy is gaining some traction.”
U.S. employment rose more than forecast and unemployment unexpectedly dropped, touching its lowest level since December 2008, Labor Department figures showed today. Canada’s jobs data also showed better-than-predicted gains. The Dow Jones Industrial Average extended its record high, and the S&P 500 index traded within 1 percent of its all-time mark.
Oil for April delivery rose 0.4 percent to settle at $91.95 a barrel in New York, after falling as much as 0.8 percent earlier. Prices advanced 1.4 percent this week, the most since the five days ended Feb. 1.
Athabasca Oil advanced 3.8 percent to C$9.65 and Encana, Canada’s largest natural gas producer, gained 1.6 percent to C$19.92.
Raw-materials companies advanced 0.8 percent, contributing the most to the S&P/TSX’s gains, as gold and silver prices rose. Banro Corp. jumped 10 percent to $1.96, after falling the most in four years yesterday on news its chief executive officer was resigning.
Semafo rose 14 Canadian cents to C$2.62, and Iamgold added 35 Canadian cents to C$6.75. Gold for April delivery rose 0.1 percent to settle at $1,576.90 an ounce.
First Quantum Minerals Ltd. (FM) rose 6.2 percent to C$20.42 ahead of a March 11 deadline for its C$5 billion hostile takeover bid for Inmet Mining Corp. The bid received approval from Canada’s ministers of industry and state today, even as Inmet’s board sent a letter to shareholders advising them to reject the offer.
Inmet shares added 1.2 percent to C$68.52. The company said it is in talks to sell a minority stake in its Cobre Panama copper project.
Financial stocks fell. Canadian Imperial Bank of Commerce lost 0.6 percent to C$82.78. Royal Bank of Canada slid 0.4 percent to C$62.43.
SNC-Lavalin slumped C$2.84 to C$43.01. Net income this year will probably climb 10 percent to 15 percent as softer commodity prices and challenges in the hydrocarbon and chemicals business erode gains from other units, SNC said. Analysts had predicted earnings of C$2.84 a share this year, a 39 percent increase.
The Montreal-based firm also reported fourth-quarter profit of 63 Canadian cents a share, missing analysts’ estimates of 92 cents according to a Bloomberg survey.
MacDonald Dettwiler & Associates Ltd. (MDA) fell 4.2 percent to C$69.70 after the satellite maker announced yesterday it will issue 3.6 million shares to help pay down outstanding debt.
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