Canada Stocks Rise Most in a Year as Crude Gains on China Data

date: 10/21/2014

Canadian stocks rose the most in more than a year, extending a rally to a fourth day, as commodity producers advanced after data showed China’s economy grew faster than forecast.

RMP Energy Inc. (RMP) and Surge Energy Inc. advanced at least 2.6 percent as energy shares rebounded for a fourth day. Canadian Pacific Railway Ltd. rose 1.3 percent after reporting an improving operating ratio. Air Canada soared 6.7 percent for a fourth day of gains.

The Standard & Poor’s/TSX Composite Index (SPTSX) jumped 209.94 points, or 1.5 percent, to 14,547.71 at 4 p.m. in Toronto, the biggest gain since July 2013. Canadian equities rallied as global stocks advanced on speculation the European Central Bank will boost stimulus and amid better-than-estimated corporate earnings in Europe and the U.S.

The Canadian benchmark has rebounded 4.9 percent in the four days since slumping to an eight-month low on Oct. 15 after entering a correction. Trading volume today was 2.4 percent below the 30-day average, according to data compiled by Bloomberg.

China’s gross domestic product rose 7.3 percent in the third quarter from a year earlier, exceeding the 7.2 percent median estimate of a Bloomberg News survey of analysts. It was also the slowest expansion since 2009.
Crude Rally

RMP Energy added 5.1 percent to C$6.59 and Surge Energy increased 2.6 percent to C$6.77. West Texas Intermediate and Brent crudes advanced after the China data signaling stronger fuel demand in the world’s second-biggest oil consuming country.

The S&P/TSX Energy Index added 1.9 percent. The group has advanced 7.1 percent in four days after posting the longest losing streak since 1997.

Teck Resources Ltd. (TCK/B), Canada’s largest diversified miner, increased 3.1 percent to C$18.07 and First Quantum Minerals Ltd. jumped 5.6 percent to C$19.80. Aluminum and copper prices advanced in London.

Centerra Gold Inc. added 3.1 percent to C$5.73. Gold for December delivery climbed to a five-week high in New York, as traders pushed back estimates for when the U.S. Federal Reserve will raise interest rates and on concern the dollar will weaken.

Canadian Pacific rallied 1.3 percent to C$224.58. The railroad’s operating ratio, an industry measure that compares expenses to revenue, improved 3.1 percentage points to 62.8 percent. A lower figure equals improving performance.

The S&P/TSX trades at 18.5 times reported earnings, down from a peak of 21 set in June, according to data compiled by Bloomberg.