Canada Stocks Rise, Halt Slide on Suncor, Barrick Earnings BeatsEric Lam
Crude trades above $49 a barrel as traders await OPEC deal
Teck slips on earnings miss with output short of estimates
Canadian stocks rose Thursday, snapping a three-day slide as some key companies posted healthy earnings and crude bounced back from the lowest levels in three weeks.
The S&P/TSX Composite Index rose 0.2 percent to 14,833.75 at 4 p.m. in Toronto. The index had fallen 0.9 percent in the three sessions since closing at a 15-month high on Friday. The equity benchmark is up 14 percent in 2016, the top performance among developed equity markets tracked by Bloomberg.
Energy producers rallied 1.3 percent to lead gains among five of 11 industries in the S&P/TSX. Crude added 0.9 percent in New York, settling just below $50 a barrel. Reuters reported Saudi Arabia and its Persian Gulf allies are willing to cut 4 percent from their peak oil output. OPEC Secretary-General Mohammed Barkindo urged members to show “maximum flexibility” to agree on output cuts as the group meets later this month.
Suncor Energy Inc., Canada’s biggest energy producer, climbed 5.7 percent to the highest in two years as the oil-sands giant swung to a profit in the third quarter after restoring operations that were shut during the Alberta wildfires in May. Suncor’s results herald possible improvements in earnings among Canadian energy producers amid the resurgence in petroleum prices this year. Crude has rebounded about 90 percent since February when it fell to its lowest level since 2003.
Barrick Gold Corp., the world’s biggest bullion miner, added 1.2 percent after beating earnings expectations. Barrick has cut its debt load by $1.4 billion this year and is on track to reach its reduction targets. It also raised its full-year production guidance. Rival Goldcorp Inc. slipped 3.7 percent for its worst slide in three weeks as production fell due to a lengthy work stoppage at one of its mines in Argentina.
Teck Resources Ltd., Canada’s largest diversified miner, ended the day down 0.6 percent after swinging between gains and losses. The company reported adjusted earnings of 26 cents a share that fell just short of the 28 cents analysts had anticipated as coal production rose less than expected and copper output declined. Teck posted third-quarter net profits of C$234 million ($174.8 million) compared with a loss of C$2.15 billion a year earlier. Teck is the best-performing stock in Canada year-to-date since 2009, with a five-fold increase fueled by rallying metallurgical coal and zinc prices.
Canadian stocks are now 17 percent more expensive than their peers in the S&P 500 Index. The S&P/TSX trades at 23.4 times earnings, compared with 20 for the S&P 500.