TORONTO (Reuters) - Resource stocks helped extend a rally in Canada’s main stock index on Wednesday despite a drop in crude oil prices, while Bombardier Inc (BBDb.TO) tumbled after the planemaker said CSeries talks with Airbus had ended.
The energy sector rose 3 percent and materials climbed 2.5 percent as investors bid up the beaten-down groups.
“To an important degree it reflects the fact that everybody got so negative,” said John Johnston, chief strategy officer at Davis-Rea. “When things are that negative you don’t need good news to go up, you just need less bad news.”
Cash-strapped Bombardier was the single biggest loser, plunging 13 percent to C$1.54 a day after Reuters reported talks between Montreal-based planemaker and Airbus, which both companies later said had failed.
Energy and materials stocks are down around 17-18 percent so far this year, hurt by a slowdown in global growth that has hit demand for the commodities they produce.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed up 221.09 points, or 1.62 percent, at 13,868.35, for its fourth straight gain and highest close since mid-August.
Consumer staples was the only sector that failed to rise. There were 11 gainers for every three decliners.
Teck Resources Ltd TCKb.TO was also a major mover, surging 14.3 percent to C$8.89 after Franco-Nevada Corp (FNV.TO) said it agreed to pay Teck $610 million to help fund operations at the Antamina mine in Peru in exchange for a share of silver production.
The deal comes just two days after Franco-Nevada revised its deal with First Quantum Minerals Ltd (FM.TO) for a project in Central America. First Quantum shares have almost doubled in price over the last several sessions, including Wednesday’s 18.2 percent rise to C$8.85
CN Rail’s industrials sector climbed 1.7 percent, while the Bank of Nova Scotia’s financials group gained 1.2 percent.
Additional reporting by Solarina Ho; Editing by Meredith Mazzilli and Diane Craft