On Thursday, the Canadian stock market reversed initial losses to turn positive for the day — after losing 1.7% on Wednesday. Yesterday’s losses were primarily driven by the rising number of coronavirus cases in many U.S. states.
Nonetheless, after opening on a slightly negative note, the S&P/TSX Composite Index was up by 0.5% this afternoon despite worse-than-expected U.S. unemployment data.
Amid the ongoing pandemic-related worries, the stock market still seems to be full of opportunities.
Let’s take a closer look at three of the top TSX movers from Thursday and find out why they rose sharply.
On June 25, shares of Parex Resources (TSX:PXT) rose by 3.3% after the company revealed its plan to increase production and restart capital expenditure programs in a press release yesterday. In the statement, the Canadian oil exploration firm also shared its second-quarter outlook with investors.
Overall, it expects its second-quarter average production to be 41,200 barrels of oil equivalent per day and its capital expenditures to be in the range of US$10 to US$12 million.
By the fourth quarter, the company plans to expand its oil production to around 44,000-48,000 barrels of oil equivalent per day.
After the announcements, analysts at Cormark Securities raised their target price on Parex Resources from $22.75 to $24 earlier today. Such factors boosted investors’ confidence and drove its stock higher on Thursday.
First Quantum Minerals
First Quantum Minerals’ (TSX:FM) stock also rose by over 3% Thursday morning after the research firm BMO revised its target price upward on the stock to $12.25 from $10 earlier. Last week, Jefferies upped its target on the company from $16 to $18. Currently, 17 out of 22 Wall Street analysts are recommending a “buy” on First Quantum — while the remaining five analysts are giving it a “hold” rating.
First Quantum Minerals is a Vancouver-based metal producer. While its stock is trading with 3.2% year-to-date losses, it has risen by more than 6% in the last five days. In the first quarter, the company’s revenue increased by 37.9% to US$1.2 billion — its highest quarterly revenue growth rate in years.
In my yesterday’s market update, I highlighted how energy stocks are continuing to rally despite worries related to the pandemic. Similarly, shares of Cenovus Energy (TSX: CVE)(NYSE: CVE) — the Canadian oil and natural gas company — were up by 3.3% this morning.
This optimism came after Citigroup and the National Bank of Canada raised their price target on Cenovus Energy. Citigroup now has a target price of $9, while the National Bank of Canada gives a target price of $11.
In the first quarter, Cenovus Energy reported an adjusted net loss of $0.97 per share and saw its revenue fell by over 20% year over year as the oil demand across the globe slumped due to the pandemic.
As the world economy gradually reopens, the rising oil demand could help energy companies — including Cenovus Energy — regain investors’ confidence.