Canada Stocks Soar to 17-Month High as Resource Producers Rally

  • Iran, Iraq voice optimism on OPEC deal ahead of Vienna meeting
  • Natural resources companies surge on copper, nickel strength

TSX Movers: DH Corp, Hudbay Minerals, RBC

Canadian stocks advanced for a third day to their highest level in 17 months as natural resources producers rallied with oil on continued optimism of an OPEC production cut and gold rebounded from the lowest level in five months.

The S&P/TSX Composite Index rose 1.2 percent to 15,039.87 at 4 p.m. in Toronto, and is trading at the highest level since June 2015. The equity benchmark is up almost 16 percent in 2016, making it the top performer among developed markets tracked by Bloomberg. Canadian shares are about 11 percent more expensive than their peers in the S&P 500 Index.

Energy companies picked up 2.5 percent, also hitting 17-month high, and raw-materials producers gained 1.7 percent to lead advances in 10 of 11 industries in the S&P/TSX. Telecommunications stocks were the only laggards. Trading volume was 4.4 percent lower than the 30-day average.

Suncor Energy Inc. and Canadian Natural Resources Ltd. increased more than 2.2 percent as energy stocks jumped for a third day with the price of oil at a three-week high. Crude prices rose 3.9 percent in New York, adding to last week’s 5.3 percent gain, as Iran signaled optimism that the Organization of Petroleum Exporting Countries will reach a consensus. Iraq said it will offer new proposals to help reach a deal at the Nov. 30 meeting in Vienna.

Teck Resources Ltd., the nation’s largest diversified miner, added 3.9 percent as industrial metals were led by a rally in copper while nickel rebounded from the lowest in two weeks. The London Metal Exchange’s index of metal prices slid the most since August last week. Copper producer First Quantum Minerals Ltd. jumped 7.2 percent.

Natural resource producers are the top-performing companies in the Canadian market this year, with materials stocks climbing 40 percent on a rebound in commodities prices from gold to crude. Investors have shrugged off a series of market surprises -- from the U.K. Brexit vote in June to Donald Trump’s surprise U.S. presidential win earlier in November -- to propel global markets higher. The MSCI All-Country World Index of developed and developing markets is up 3.3 percent this year and is headed for its biggest annual gain since 2013.

Teck Resources is the top stock in the S&P/TSX, up almost six-fold this year as prices for coking coal and zinc have also surged. Energy producers have jumped 30 percent, led by Bonavista Energy Corp. and Encana Corp.

Goldcorp Inc. rose 1.3 percent as gold advanced from the lowest level in more than five months as the Bloomberg Dollar Spot Index snapped three days of gains. Silver also rose after nearing a bear market.

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