TORONTO (Reuters) - Canada’s benchmark stock index notched a seven-month high on Thursday, fueled by a rally in energy and mining stocks as commodity prices rose, but gains were tempered by a drop in the shares of Shopify Inc for a second straight day.
The Toronto Stock Exchange’s S&P/TSX composite index ended up 55.30 points, or 0.35 percent, at 15,776.30, its highest close since Feb. 23.
“I wouldn’t be surprised if the TSX breaks the 16,000 mark, which has been pretty elusive, some time in the fourth quarter,” said Elvis Picardo, portfolio manager at HollisWealth Inc.
“The TSX gains from a strong global economy. This is probably the most synchronized global growth we have been having in many years.”
The index is on track to set a record high by year end, according to a Reuters poll.
Sectors that tend to benefit most from a pick-up in growth include the energy and materials groups, which jointly account for 30 percent of the weight of the index.
The materials group, which includes precious and base metals miners and fertilizer companies, rose for the fourth day in a row on bullish sentiment about demand, particularly from China, and a rally in the price of copper.
The group gained 0.8 percent, with First Quantum Minerals Ltd jumping 4.8 percent to C$15.81, and Teck Resources advancing 4.3 percent to C$28.91. Ivanhoe Mines Ltd surged 6.8 percent to C$4.56.
Copper prices advanced 2.5 percent to $6,689.50 a tonne. [MET/L]
The energy group climbed 0.6 percent as oil prices heated up on signs that Saudi Arabia and Russia would limit production through next year. U.S. crude settled 1.6 percent higher at $50.79 a barrel.
TransCanada Corp climbed 1.1 percent to C$61.55, despite news the company was cancelling certain pipeline projects.
The move was anticipated, said Manash Goswami, a portfolio manager with First Asset Investment Management Inc.
Nine of the index’s 10 main sector groups ended higher, including a 0.2 percent gain for heavyweight financial shares.
Tempering some of the gains was Shopify’s sharp retreat in heavy trading. Shares fell 2.1 percent to C$126.19, extending Wednesday’s losses after short-seller Citron Research said the stock was overvalued and criticized the Canadian e-commerce software provider’s marketing practices.
Food retailer Metro Inc, which agreed on Monday to buy pharmacy chain Jean Coutu Group, fell 1.2 percent to C$42.28, while the overall consumer staples group dipped 0.1 percent.
Additional reporting by Solarina Ho; Editing by James Dalgleish and Tom Brown