Canadian Stocks Rise a Fifth Day as Banks Advance on Rate CutEric Lam
Canadian stocks rose, extending the biggest rally since February to a fifth day, as lenders advanced after the central bank lowered borrowing rates.
Magna International Inc. dropped 3.5 percent after agreeing to acquire German manufacturer Getrag. Toronto-Dominion Bank and Bank of Nova Scotia added more than 1.1 percent after the Bank of Canada yesterday cut its benchmark lending rate in the face of a slumping economy. Sleep Country Canada Holdings Inc. slumped 5 percent in its trading debut.
The Standard & Poor’s/TSX Composite Index rose 68.80 points, or 0.5 percent, to 14,731.08 at 4 p.m. in Toronto. The benchmark equity gauge has gained 3.2 percent in five days, the most since February. The rally has pushed the gauge to a 0.7 percent gain this year.
FirstService Corp. surged 6.7 percent as financial services companies increased 0.8 percent as a group. Eight of 10 industries in the S&P/TSX advanced on trading volume 6.2 percent higher than the 30-day average today.
The threat of a contracting economy prompted Bank of Canada Governor Stephen Poloz to cut his policy interest rate for the second time this year, to 0.5 percent from 0.75 percent yesterday.
The nation’s largest lenders, including Scotiabank, Royal Bank of Canada and Toronto-Dominion, have lowered their prime rates in response.
Bombardier Inc. soared 3.7 percent, rebounding from a 1993 low, after the aircraft maker hired Pratt & Whitney Canada executive John Di Bert as its chief financial officer. Industrials climbed 0.4 percent as a group.