By Sarah Pringle, MarketWatch
SAN FRANCISCO (MarketWatch) – Canadian stocks rallied Tuesday after the long holiday weekend, as commodity and technology companies extended gains following Friday’s encouraging U.S. jobs report.
“Canadian stocks have had a banner day today, catching up to their global peers and riding high on the crude oil and copper rallies,” Colin Cieszynski, an analyst at CMC Markets Canada, wrote in a note.
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Fed official Eric Rosengren tells the Wall Street Journal that the central bank should be more aggressive about bond buying. How did that play out across the markets? Jonathan Cheng discusses on Markets Hub. (Photo: Reuters)
Toronto’s benchmark equities index /zigman2/quotes/210598478/delayed CA:GSPTSE +1.85% jumped 200.91 points, or 1.7%, to finish at 11,863.50.
Leading sectors, metals and mining stocks soared 4.6%, followed by a 2.9% rise in the materials sector /zigman2/quotes/210598474/delayed XX:TORGC195 +2.19% and a 2.2% climb in information-technology equities /zigman2/quotes/210598463/delayed XX:TORGC194 +3.73% .
“Economic news at the margin seems to be gradually improving, so this risk-on could last for a while. The Achilles heel is something unforeseen that may happen in Europe,” said Ian Nakamoto, director of research at MacDougall MacDougall & MacTier.
“Equity markets have been doing well in past few days, especially Friday with the huge jobs reports spilling over… The stocks leading the way are the ones that got beat up the most,” he added.
Strengthening commodity companies included Methanex Corp. /zigman2/quotes/209908559/delayed CA:MX +5.99% up 5.2%, Canadian Natural Resources Ltd. /zigman2/quotes/203742161/delayed CA:CNQ +0.84% jumping 7.3%, Class B shares of Teck Resources adding 5.6%, and Niko Resources climbing 7%.
Gold futures rose early Tuesday before reversing gains, with gold for December delivery finishing 0.2% lower at $1,612.80 an ounce on the New York Mercantile Exchange. Read more on gold.
Still, Canadian gold miners advanced, as Iamgold Corp. /zigman2/quotes/206182143/delayed CA:IMG +2.10% and Eldorado Gold Corp. /zigman2/quotes/207321207/delayed CA:ELD +2.81% each rose about 5.5%, followed closely by a climb in Osisko Mining Corp. /zigman2/quotes/205809926/delayed CA:OSK +5.59% .
Supporting the technology sector, shares of BlackBerry maker Research In Motion Ltd. rose 4.9%. Celestica Inc. /zigman2/quotes/204449387/delayed CA:CLS +2.33% , which delivers solutions to global manufacturers and services, tacked on 3.1%, while Evertz Technologies, video and audio equipment manufacturer, /zigman2/quotes/205800871/delayed CA:ET +2.96% added 2.6%.
After four weeks of gains, the Canadian dollar again broke parity against its U.S. counterpart /zigman2/quotes/210561978/realtime/sampled USDCAD -0.0543% , with one U.S. dollar purchasing C$0.9968 vs. C$1.0006 Monday. The greenback has fallen 2.2% against Canada’s currency in the past month.
On the corporate front, shares of Harry Winston Diamond Corp. rallied almost 4% on news of ongoing talks with BHP Billiton /zigman2/quotes/208108397/composite BHP +2.87% , regarding the possible sale of its diamond business, according to the Financial Times.
In economic news, the total value of building permits declined 2.5% to $6.8 billion in June, mostly due to drops in the non-residential and residential sectors in Alberta and British Columbia, according to Statistics Canada.