TORONTO (Reuters) - Canada’s main stock index rose on Friday as positive U.S. economic data and hopes of a Chinese government stimulus helped drive up shares of natural resource companies.
But one sore spot was a 6.5 percent drop in shares of BlackBerry (BB.TO) after the company reported a quarterly loss and a sharp drop in revenue as its smartphone sales continued to slide.
The market was encouraged by data showing a rise in U.S. consumer spending in February, following a wave of upbeat numbers that suggested the economy in the first quarter was shaping up stronger than some people had expected.
China’s Premier Li Keqiang said that Beijing was ready to support the world’s second-biggest economy, a major market for Canada’s natural resources, and signaled a willingness to drive infrastructure investment.
“I call it ‘QE brunch coming to China’,” said Adrian Mastracci, portfolio manager at KCM Wealth Management. “Now all of a sudden China is on the stimulus bandwagon.”
“It means that the economy is not doing well on its own,” he added. “However, investors interpret it as bailing them out.”
But appetite for Canadian equities remains fairly strong, said Mastracci.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed up 81.88 points, or 0.58 percent, at 14,260.72, after declining in the previous two sessions. It is up about 4.7 percent this year.
Five of the 10 main sectors on the index were higher on Friday.
The materials sector, which includes mining stocks, advanced 1.3 percent. Goldcorp Inc (G.TO) added 1.2 percent to C$27.79, and Barrick Gold Corp ABX.TO climbed 1.5 percent to C$20.24.
In corporate news, BRP Inc (DOO.TO) forecast a lower-than-expected full-year profit. Shares of the snowmobile maker shed 10.9 percent to C$28.40.
BlackBerry was trading at C$9.31, helping drag the information technology sector down 1.1 percent.
Editing by Peter Galloway