Canada Stocks Rally Most in Three Weeks as Oil Holds Above $31by
Health-care and energy stocks lead advances in S&P/TSX
Raw-material companies retreat as commodity prices slump
Carnage in Canadian stocks abated, at least for now, as the nation’s benchmark index reversed morning losses to post its best day of the year after crude prices held above $31 a barrel.
The Standard & Poor’s/TSX Index advanced 1.4 percent to 12,336.03 at 4 p.m. in Toronto, trimming its loss in 2016 to 5.2 percent. The index joined a rally in U.S. stocks after oil’s rebound from 12-year lows fueled speculation that equities declines had gone too far too fast this year.
Energy companies rallied 3.8 percent to lead advances on Thursday, while Valeant Pharmaceuticals International Inc. reversed early losses to post a 5.4 percent gain and lead health-care shares higher. Oil companies Kelt Exploration Ltd. and Paramount Resources Ltd. gained as much as 13 percent.
Brent rebounded after an attack on OPEC member Indonesia. The global benchmark for crude had slid on Wednesday below $30 a barrel for the first time since April 2004 amid speculation that sanctions on Iran may be lifted by next money. Oil and gas producers were the worst performers last year, plummeting 26 percent.
Material stocks were the only to decline in the S&P/TSX today as the Bloomberg Commodities Index was little changed after dropping to the lowest since 1991 on Tuesday. Gold companies, which rallied earlier this year as investors sought a haven, took a hit as risk-on sentiment returned to the market. Yamana Gold Inc. and Alamos Gold Inc. both dropped 10 percent.
Canada’s resource-rich index was the second of seven countries to see its benchmark enter a bear market, capping a 20 percent slide on Jan. 7.
Air Canada tumbled 9.2 percent to its lowest level since October 2014. Raymond James downgraded the airline, citing a poor expansion strategy and it’s capital expenditure commitments.