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Roundup: Canadian stocks advance to fresh high of 2016

Xinhua, March 4, 2016 Adjust font size:

Canada's main stock market in Toronto hit its highest level of the year on Thursday after a rally for six consecutive days.

The Toronto Stock Exchange's benchmark Standard & Poor's/TSX Composite Index gained 105.72 points, or 0.81 percent, to close at 13,123.65 points. Seven of the TSX index's eight main sub-sectors moved higher.

Sustained rebounding in crude oil prices boosted the rise in energy and mining shares, up 2.82 percent and 1.24 percent respectively. Baytex Energy Corp. added 12.79 percent, MEG Energy Corp. jumped 18.94 percent, while Athabasca Oil Corporation moved up 12.24 percent.

Among the most influential gainers was Canadian Natural Resources Ltd., which advanced 8.88 percent to 32.85 Canadian dollars (24.52 U.S. dollars) per share, even as it cut its 2016 capital expenditure and reported a sharp fall in profit.

TSX pushed above 13,000 for the first time in 2016 on Wednesday as investors shook off worries about global growth amid upbeat data from major economies and signs of a rebound in commodity prices.

Following the Christmas holiday when the stock market shut down, the TSX rattled off a long series of losses before bottoming out at 11,843 on Jan. 20.

Since then, Canadian stocks have come roaring back and are now up by 1,300 points from their low of six weeks ago. The index is still well off its all-time high of 15,561 set in the summer of 2014, before oil prices dived from over 100 U.S. dollars a barrel to below 40 now.

The TSX has been buoyed by energy companies that have quietly rallied as oil prices have seemingly found a bottom above 30 U.S. dollars a barrel.

Also the Canadian federal government's loud signaling that it plans to spend heavily to stimulate the economy for the next few quarters is good news for other companies in the broader economy, especially among big banks whose shares have rallied since posting earnings last week.

Financial stocks went up 0.67 percent as a group, with Royal Bank of Canada up 0.88 percent, Bank of Montreal up 0.86 percent, but Manulife Financial Corporation down 1.24 percent.

Gold has also been a positive force. The most active gold contract for April delivery rose 16.4 U.S. dollars, or 1.32 percent, to settle at 1,258.20 U.S. dollars per ounce. Many gold companies, including Goldcorp, Barrick, Yamana Gold and others, were higher, pushing up the overall index.

Toronto-based Kinross Gold Corporation went up 5.91 percent to 4.12 Canadian dollars a share, while Vancouver-based B2Gold Corp. moved higher 8.28 percent to 1.57 Canadian dollars each share.

In the industrial sector, SNC-Lavalin Group Inc. was up 3.29 percent to 45.51 Canadian dollars a share after posting a better-than-expected adjusted fourth-quarter profit and said it saw profit growth at its core engineering and construction business in 2016.

On the negative side, Valeant Pharmaceuticals International Inc fell 4.24 percent to 86.91 Canadian dollars a share after the embattled drug maker said a senior executive had resigned, not having been asked to leave.

Meanwhile, the record-shattering pace of Toronto's housing market shows no sign of ending as sales far outpace new listings. Sales in the Toronto area climbed more than 21 percent in February from a year earlier. Even factoring in the extra Leap Year day, sales topped the previous February 2010 record, the Toronto Real Estate Board said Thursday.

The average home price in the Toronto area climbed almost 15 percent to 685,278 Canadian dollars (511,560 U.S. dollars), while the MLS home price index, deemed a better measure, showed a gain of 11.3 percent.

According to the UN FAO Food Price Index, the average price of food in global markets has fallen by 14.5 percent in the last year as wholesale prices fell for oil, grains and other food products. However that is a marked difference from Canada, where food prices rose 4 percent in the year to January, according to the most recent Consumer Price Index from Statistics Canada.

The food price inflation in Canada is mainly tied to the value of the dollar, which has fallen 15 percent since this time last year. Prices for fresh vegetables in Canada were up 18.2 percent in the 12 months to January, while meat prices rose by 5 percent. Since 81 percent of fruit and vegetables sold in Canada are imported, that has had a direct impact on the price of produce.

The Canadian dollar was traded higher at 0.7465 U.S. dollar, compared with Wednesday's closing rate of 0.7448 U.S. dollar. Enditem