Bloomberg News

Canada Stocks Rise as Energy, Bank Shares Gain on Europe Plans

October 12, 2011

Oct. 12 (Bloomberg) -- Canadian stocks rose for a second day, led by energy and financial shares, after European Commission President Jose Barroso’s call for a coordinated response to the continent’s debt crisis spurred optimism about the global economy.

Suncor Energy Inc., the nation’s largest oil and gas producer, gained 2.6 percent after the commission released a so- called road map to address Greek debt, European lenders and the economy. Manulife Financial Corp., North America’s fourth- largest insurer, increased 4 percent. First Quantum Minerals Ltd., Canada’s second-largest publicly traded copper producer, jumped 6.2 percent as the U.S. dollar dropped against six major counterparts.

The Standard & Poor’s/TSX Composite Index rose 154.41 points, or 1.3 percent, to a three-week high of 12,029.96. The S&P/TSX rebounded 7.6 percent in five days after closing at a 14-month low on Oct. 4 as optimism European officials will aid the continent’s banks led to gains in the euro and a weaker U.S. dollar.

“The global mindset had been very negative, very focused on worst-case scenarios,” David Baskin, president of Baskin Financial Services Inc., said in a telephone interview from Toronto. The firm oversees C$400 million ($393 million). “That doesn’t seem to be happening, so there’s a sigh of relief.”

Crude oil futures surged 13 percent and copper rallied 6 percent from Oct. 4 to yesterday, boosting energy and raw- materials stocks. Companies in those industries make up 47 percent of Canadian stocks by market value, according to Bloomberg data.

Currency Gains

The euro advanced 1.1 percent against the U.S. dollar today, extending its climb since Oct. 3 to 4.7 percent.

Fifty-nine of 66 S&P/TSX energy companies rose. Suncor increased 2.6 percent to C$29.61. Crescent Point Energy Corp. rallied 4.9 percent to C$41.91 as oil and gas producers with operations in western Canada climbed a day after China Petrochemical Corp. agreed to buy Daylight Energy Ltd. for C$2.2 billion. Athabasca Oil Sands Corp., an oil-sands developer that began trading in April 2010, soared 8.15 percent to C$12.60 after advancing a record 8.17 percent yesterday.

Trican Well Service Ltd., the country’s biggest oilfield- services company, gained 8.8 percent, the most since September 2009, to C$18.56. The shares rallied for a second day after New Orleans-based Superior Energy Services Inc. agreed to buy Houston-based Complete Production Services Inc. for about $2.6 billion in cash and stock.

All S&P/TSX banks and insurers advanced. Manulife climbed 4 percent to C$12.85. Sun Life Financial Inc., Canada’s third- biggest insurance company, climbed 3.7 percent to C$26.45. Royal Bank of Canada, the country’s largest lender by assets, gained 1.8 percent to C$48.83.

Copper Producers

Copper futures increased 3.1 percent on the Comex in New York as Asian inventories shrank. First Quantum Minerals surged 6.2 percent to C$17.21. Teck Resources Ltd., the country’s biggest base-metals and coal producer, rose 2.1 percent to C$36.03. Quadra FNX Mining Ltd., which operates in the U.S., Canada and Chile, climbed 5 percent to C$11.01.

Extorre Gold Mines Ltd., which explores in Argentina, gained for a second day after reporting high-grade drilling results, advancing 13 percent to C$8.89. The shares jumped 9 percent yesterday.

BlackBerry maker Research In Motion Ltd. retreated 3.5 percent to C$24.27 after service outages spread to North America and South America. Disruptions continued in Europe, the Middle East and Africa for a third day.

The S&P/TSX has increased at least 150 points four of the past five days. That has happened only once before, when the index climbed at least 150 points five times in a six-day period in December 2008 and January 2009.

--Editors: Joanna Ossinger, Stephen Kleege

To contact the reporter on this story: Matt Walcoff in Toronto at mwalcoff1@bloomberg.net

To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net


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