Canadian Equities Rally Most Since September as Fed Boosts Ratesby
S&P/TSX surpasses 13,000 after falling to two-year low
Health-care sector leads gauge as Valeant gains third day
Canadian stocks surged the most since September, as the end of seven years of near-zero interest rates in the U.S. bolstered confidence that the economy of Canada’s largest trading partner is on a steady growth path.
The Standard & Poor’s/TSX Composite Index advanced 1.9 percent to 13,166.08 at 4 p.m. in Toronto, the biggest gain in 11 weeks. The gauge slumped on Monday to its lowest level since October 2013.
Equities rallied as the Federal Open Market Committee boosted rates today for the first time since 2006. All 10 groups in the benchmark advanced today, with health-care stocks leading gains. Raw-material producers advanced 3.9 percent, as gold, silver and copper prices rallied. OceanaGold Corp., Barrick Gold Corp. and Lundin Mining Corp. rose as much as 7.8 percent.
Canadian commodity and financial shares tumbled after the Fed didn’t raise rates in September, partly due to a slowdown in China, the world’s largest consumer of commodities. The concerns have weighed on Canada’s resource-rich equity gauge, making it third worst performer this year among developed-nation benchmarks.
Canadian Pacific Railway Ltd. rose 2.9 percent after raising its takeover offer for Norfolk Southern Corp. The company is attempting to persuade Norfolk Southern to accept a proposal to create a transcontinental railroad.
Valeant Pharmaceuticals International Inc. jumped 8.1 percent as it attempted to restore confidence during an investor conference Wednesday. The drugmaker said that the fallout with Philidor Rx Services will cut hundreds of millions of dollars from earnings this quarter and next year.