OTTAWA (Reuters) - Canada’s main stock index rose on Monday, extending its recovery from a six-month low last week, as heavyweight financial shares rallied and after Hudson’s Bay Co got a boost from an investor request that the company explore strategic options.
The Toronto Stock Exchange’s S&P/TSX composite index closed up 73.5 points, or 0.48 percent, at 15,266.04.
It follows a 1.8 percent drop for the index last week. On Thursday, it touched its lowest intraday since Dec. 5 at 15,077.95.
“I think we were long overdue for a rally and I think we are getting it here,” said John Kinsey, portfolio manager at Caldwell Securities.
U.S. activist investor Jonathan Litt called for Hudson’s Bay to consider going private and to monetize its vast real estate holdings, sending shares in the department store retailer up 15.1 percent to C$10.22.
The overall consumer discretionary group climbed 1.5 percent, while the heavyweight financial services sector rose 0.8 percent, led by gains for the country’s major banks.
Royal Bank of Canada, Canada’s biggest lender by assets and market value, advanced 0.8 percent to C$94.30.
Investors have been encouraged by the Bank of Canada’s greater confidence in the outlook for the country’s economy, Kinsey said.
The central bank’s top two officials have said that rate cuts put in place in 2015 had largely done their work, and the bank would assess whether rates need to be kept at near-record lows.
The bounce for the Toronto market came as a rebound in technology stocks helped push Wall Street to record highs.
Canada’s technology sector rose 2.4 percent, led by a 4.3 percent advance in the shares of Shopify Inc to C$119.90.
Still, the nearly flat performance for the TSX this year compares poorly with a 9.6 percent gain for the S&P 500. Recent weakening in commodity prices has weighed on Canada’s market.
U.S. crude oil futures settled 54 cents lower at $44.20 a barrel, while gold declined 0.8 percent following hawkish comments from a top Federal Reserve official.
The energy group fell 0.5 percent and the materials group, which includes precious and base metals miners and fertilizer companies, gained just 0.1 percent.
Valeant Pharmaceuticals International Inc rose 5.9 percent to C$17.79 after hedge fund manager John Paulson joined the company’s board.
Shares of Bombardier advanced 4.9 percent to C$2.59. The company said it had received seven more orders for its Q400 aircraft from Philippine Airlines.
Additional reporting by Leah Schnurr; Editing by Bernadette Baum and David Gregorio