The Toronto stock market rose Friday after Enbridge stock gained on good news from a U.S. regulator and energy stocks jumped as oil prices rose over the US$74 a barrel mark.
The S&P/TSX Composite Index rose 97.84 points, or 0.6 per cent, to 16,277.73.
Energy stocks increased 1 per cent, led by nearly 2.5-per-cent increases from Cenovus Energy Inc. and Canadian Natural Resources Ltd. Husky Energy Inc. was up 1.6 per cent and Suncor rose 1 per cent.
Enbridge Inc. rose 7 per cent after a Minnesota regulator on Thursday approved a certificate of need for the rebuild of its Line 3 oil pipeline, angering environmentalists but offering hope to Western Canadian oil producers that have struggled to move crude oil to refiners.
Oil prices rose on Friday on concern that U.S. sanctions against Iran would remove a substantial volume of crude oil from world markets at a time of rising global demand.
U.S. crude rose above the US$74 per barrel mark, on track for a weekly rise of more than 8 per cent. The session high of US$74.43 was the highest since Nov. 26, 2014.
In economic news, Canada’s economy shrugged off the effects of bad weather to post unexpected growth in April, pushing up the Canadian dollar and boosting the prospects for an interest rate hike next month.
Statistics Canada said on Friday that GDP rose by 0.1 per cent from March, the seventh time in the last eight months that the economy has expanded. Analysts in a Reuters poll had predicted no change. The Canadian dollar rose to 76.10 cents US after the news.
Materials stocks rose 1.6 per cent. First Quantum Minerals Ltd. was up 6.2 per cent after sources told Reuters that it could be a takeover target by Rio Tinto. Banking sources say pressure is mounting for a copper deal because of its widespread industrial use. Turquoise Hill gained 5.4 per cent and West Fraser Timber was up 3.1 per cent.
Vancouver-based Nevsun Resources rose 6.5 per cent after bankers and analysts said it could also prove attractive for Rio Tinto.
In New York, a surge in Nike Inc. shares and a rally in bank stocks lifted Wall Street’s major stock indexes on Friday, though all three still posted weekly declines.
Based on the latest available data, the Dow Jones Industrial Average rose 59.29 points, or 0.24 per cent, to 24,275.34, the S&P 500 gained 2.32 points, or 0.09 per cent, to 2,718.63 and the Nasdaq Composite added 6.62 points, or 0.09 per cent, to 7,510.30.
For the week, the S&P 500 lost 36.51 points, or 1.3 per cent; The Dow fell 309.48 points, or 1.3 per cent; The Nasdaq sank 182.51 points, or 2.4 per cent.
Shares of Nike soared 13 per cent to hit an all-time high of US$81 after the world’s largest footwear maker reported a return to growth in North America in the last quarter and gave an upbeat forecast for the year.
Nike shares were last up 11.5 per cent to $79.91, on track for their biggest one-day gain in nearly four years. Nike was the top boost to the Dow and the S&P 500.
The S&P 500 bank sector index rose 1.1 per cent after touching its highest level in a week as U.S. lenders cleared the second part of the Federal Reserve’s annual stress tests.
Wells Fargo & Co. led the gains, jumping 4.4 per cent, while shares of Citigroup Inc, U.S. Bancorp, M&T Bank Corp and SunTrust Banks Inc were all up more than 1 per cent.
“It’s certainly an item of good news in the absence of much to bite on,” Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia, said of the stress test results.
Investors took in stride U.S. Commerce Department data that showed consumer spending slowing as the core personal consumption expenditures (PCE) price index, a measure of inflation, hit the Federal Reserve’s 2-per-cent annual target for the first time in six years. On several occasions this year, worries of rising inflation and a subsequent economic slowdown have sent stocks tumbling.
“We’re carrying on from what we saw yesterday,” Luschini said. “People are squaring away positions going into the month and the quarter’s end.”
Shares of Vertex Pharmaceuticals Inc jumped 15.3 per cent, the most on the S&P 500, after rival Galapagos NV’s cystic fibrosis program reported disappointing trial data.
KB Home shares climbed 7.2 per cent after the homebuilder’s second-quarter results beat Wall Street estimates. The strong results also boosted shares of other homebuilders, including D.R. Horton Inc and PulteGroup Inc.
Constellation Brands Inc fell 4.8 per cent after the Corona beer maker’s quarterly profit and full-year earnings forecast missed analysts’ estimates.
Reuters