Gold’s best run since 2010 pushed Canadian equities to the top spot among developed-market stocks this year. Fifty dollar crude will give them an opportunity to stay there.
That’s the view of strategists who follow the nation’s resource-heavy stock market. They expect energy producers will rally into the end of the year as the most expensive crude in 15 months delivers a surge in earnings. The group will take over the baton from the S&P/TSX Materials Index that rallied as much as 65 per cent this year before fading in the third quarter.
A year after commodities producers dragged the S&P/TSX Composite Index to its worst result since the financial crisis; companies that mine metals and produce oil and gas have fuelled a 14 per cent surge in the benchmark for Canadian equity that’s left it the best performer among 24 developed markets tracked by Bloomberg. With crude trading above $50 (£40.85) a barrel for the first time in 18 months, analysts see energy producers poised to deliver a five-fold profit increase in 2017 that will propel share gains.
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