Canadian Stocks Advance as Banks Help Lead S&P/TSX IndexEric Lam
Canadian stocks rose a second day as banks helped lead gains, offsetting a drop in industrials after data showed the U.S. added fewer jobs than forecast in July.
Turquoise Hill Resources Ltd., a unit of Rio Tinto Group, jumped 8.7 percent for a third day of gains after agreeing to new terms for the sale of a stake in a mine. Royal Bank of Canada, the nation’s largest lender, climbed 0.8 percent. SNC-Lavalin Group Inc., Canada’s largest engineering company, sank 6.1 percent after reporting an unexpected second-quarter loss. Paladin Energy Ltd. plunged 22 percent after saying it will sell additional shares.
The Standard & Poor’s/TSX Composite Index rose 9.29 points, or 0.1 percent, to 12,603.25 at 4 p.m. in Toronto. The gauge pared a weekly loss to 0.4 percent. Trading volume was about 24 percent lower than the 30-day average.
“It’s time for a bit of a pause,” said Keith Richards, a fund manager with ValueTrend Wealth Management in Barrie, Ontario. The firm manages about C$110 million ($106 million). “We’ve had this great run in the U.S. markets.”
U.S. payrolls rose by 162,000 last month, less than an estimated 185,000 and the smallest advance in four months. The unemployment rate dropped to 7.4 percent from 7.6 percent. The U.S. Federal Reserve has indicated its $85 billion monthly bond buying may be trimmed should the economy meet its forecasts, though Chairman Ben S. Bernanke has said there’s no fixed schedule for reducing stimulus.
Turquoise Hill surged 8.7 percent to C$5 after agreeing to sell its 50 percent stake in Altynalmas Gold Ltd. to Sumeru Gold BV for $235 million, down from $300 million agreed to in February. In exchange, Turquoise Hill will receive advance payment by Aug. 9, ahead of the closing of the transaction.
Silvercorp Metals Inc. gained 2.6 percent to C$3.12 as silver rallied 1.5 percent to $19.912 an ounce in New York, snapping three days of losses.
Royal Bank rose 0.8 percent to C$64.43 and Toronto-Dominion Bank advanced 0.7 percent to C$87.37 as the S&P/TSX Financials Index rose the most in two weeks.
Paladin Energy Ltd. slumped 22 percent to 72 Canadian cents, the biggest loss since in went public in 2005. The Australian company producing uranium in Africa announced it will sell shares to institutions after ending talks to sell a stake in its mine in Namibia, citing low prices for the nuclear fuel.
Athabasca Oil Corp. lost 3.9 percent to C$7.64 and Pengrowth Energy Corp. slipped 1.7 percent to C$5.94. Oil dropped 0.9 percent to $106.94 a barrel, paring a weekly advance.
SNC-Lavalin, based in Montreal, tumbled 6.1 percent to C$40.38 after cutting its annual profit forecast. The company cited losses in the second quarter in its oil and gas division and its infrastructure and environment unit. Chief Executive Officer Robert Card said in the statement that 2013 is “proving to be a very challenging year.”
Bombardier Inc. lost 1.6 percent to C$4.87. The world’s third-biggest aircraft maker said it is working toward a debut takeoff for the CSeries jetliner within the next few weeks, after three delays since November.