Canada Stocks Rebound as U.S. Housing Starts Jump, Gold RalliesEric Lam
Canadian stocks rose for the first time in four days after U.S. housing starts jumped more than estimated, crude erased losses and gold rallied from its biggest drop since 1980.
Suncor Energy Inc., Canada’s largest oil producer, jumped 3.3 percent. Gabriel Resources Ltd. and New Gold Inc. climbed at least 3 percent. First Quantum Minerals Ltd. surged 9.3 percent after copper rose from its lowest level in almost 18 months. Bank of Nova Scotia and Bank of Montreal each rose 1.4 percent as financial stocks snapped three days of losses.
The Standard & Poor’s/TSX Composite Index rose 115.04 points, or 1 percent, to 12,119.92 at 4 p.m. in Toronto, rebounding from its biggest loss of 2013 yesterday. The benchmark equity gauge dropped 4.2 percent over three days.
“The U.S. housing market is in significantly better shape than two to three years ago, and their numbers will continue to improve,” David Cockfield, fund manager with Northland Wealth Management, said from Toronto. The firm manages C$225 million ($220 million). “Yesterday was pretty extreme. The market is waiting to see what the next move is as far as gold is concerned. Crude probably overreacted to the gold story.”
New-home construction in the U.S. jumped 7 percent in March to a 1.04 million annual rate, the most since June 2008, after a revised 968,000 pace in February that was larger than previously reported, Commerce Department figures showed today in Washington. The median estimate of 80 economists surveyed by Bloomberg called for 930,000.
Banks and energy producers contributed most to gains in the S&P/TSX as nine of 10 industries advanced. Trading volume was 4.7 percent higher than the 30-day average at this time of the day.
Bank of Nova Scotia rose 1.4 percent to C$57.70 and Bank of Montreal gained 1.4 percent to C$63.16 as the S&P/TSX Financials Index snapped a three-day losing streak. The group is up 1.5 percent this year.
Suncor rose 3.3 percent to C$28.41 and Cenovus Energy Inc. advanced 1.4 percent to C$29.44 as crude for May deliver rose 1 cent to settle at $88.72 a barrel in New York to erase earlier losses of as much as 3 percent.
Gabriel Resources added 3.6 percent to C$1.44 and New Gold increased 3 percent to C$6.95. Gold for June delivery gained 1.9 percent to close at $1,387.40 an ounce in New York, rebounding from a two-day, 13 percent plunge. Gold has fallen 17 percent this year, threatening to end a 12-year rally.
First Quantum Resources surged 9.3 percent to C$17.03 and Teck Resources Ltd., Canada’s largest diversified miner, rose 2.3 percent to C$26.75. Copper for delivery in May added 1 percent to settle at $3.3055 a pound in New York.