Canadian Stocks Rise as U.S. Economy Adds Most Jobs in Two YearsGerrit De Vynck
Canadian stocks rose for a fourth day after data showed the biggest monthly gain in U.S. employment in more than two years.
Torstar Corp. rallied 22 percent after saying it would sell its romance-novel publishing unit for C$455 million ($414.5 million). Sierra Wireless Inc. fell 11 percent after lowering its prediction for second quarter revenue. Constellation Software Inc. rose 3.6 percent as TD Securities raised its recommendation on the stock to buy from hold.
The Standard & Poor’s/TSX Composite Index gained 101.08 points, or 0.7 percent, to 14,765.15 in Toronto. The equity gauge has risen to the highest level since June 2008 after capping a 10th month of gains in April. The U.S. added 288,000 non-farm jobs and the unemployment rate sank to 6.3 percent, outpacing economist estimates as the economy recovered from a colder-than-usual winter.
“It beat the consensus by about 70,000 jobs so that’s a very strong number,” said Luciano Orengo, a fund manager with Manulife Asset Management Ltd. in Toronto. “The Canadian economy does well because the U.S. is getting better,” said Orengo, who helps manage about C$1.4 billion ($1.3 billion).
Torstar climbed 22 percent to C$8.15, its biggest jump ever. The owner of the Toronto Star newspaper is selling Harlequin Enterprises Ltd., the world’s biggest publisher of romance novels, to Rupert Murdoch’s News Corp.
Sierra Wireless fell 11 percent to C$21.46. The Richmond, British Columbia-based communications equipment company beat analyst estimates for first-quarter revenue but said second quarter earnings would be lower than expected. While Sierra Wireless operates in a growing market, it is facing a lot of competition, Orengo said.
“There’s a lot of companies that want to be in this space and when we sold Sierra Wireless that was sort of the thesis as to why, it was doing well but starting to catch these headwinds with competition,” Orengo said.
Constellation Software rose 3.6 percent to C$263.19. On April 30, the company reported earnings that missed analyst estimates while saying cash flow from operations increased year-over-year to $100 million from $34 million.
Nine of ten industries in the benchmark index rose, led by technology and materials companies. West Texas Intermediate crude oil rose 0.3 percent to $99.76 a barrel and gold rose 1.5 percent to $1,302.90 an ounce.
Pattern Energy Group Inc., which owns wind power projects, fell 4 percent to C$28.23 after posting a first-quarter earnings loss. The company said today it will buy a wind farm in Texas for $125 million.