Nov. 4 (Bloomberg) -- Canadian stocks rallied for a second day, led by raw-materials and energy producers, as gold rose to a record and oil climbed above $80 a barrel.

Barrick Gold Corp., the world’s largest bullion producer, climbed 2.3 percent as the precious metal rose to an all-time high on speculation that central banks may buy more of it. Teck Resources Ltd., the country’s largest base-metals producer, added 1.5 percent as a weaker U.S. dollar bolstered the appeal of oil and copper as alternative investments. Canadian Oil Sands Trust, lead owner of the world’s largest oil-sands producer, climbed 2.6 percent as crude rose for a third day.

“Commodity-related issues, that’s the area that’s driving the market,” said Fred Ketchen, managing director of equity trading at Scotia McLeod Inc. in Toronto. “That’s basically predicated on a weaker U.S. dollar compared to a Canadian dollar.”

The Standard & Poor’s/TSX Composite Index added 45.30 points, or 0.4 percent, to 11,071.20. The benchmark index fell in October for the first month since February as U.S. consumer spending, consumer confidence and home sales missed economists’ forecasts. The S&P/TSX maintained its gain today after the Federal Reserve said that it plans to keep its benchmark interest rate at a record low for “an extended period.”

Canada’s currency appreciated to the highest level in a week after the Federal Reserve comments and has rallied 15 percent this year against the U.S. dollar.

Central Bank ‘Flexibility’

Bank of Canada Deputy Governor John Murray said a strong Canadian dollar threatens the nation’s economic recovery and reiterated a pledge to keep the bank’s benchmark lending rate at a record low through June unless the inflation outlook shifts.

The central bank has “flexibility” to implement monetary policy, even with its key rate as low as it can go, Murray said in a speech today in Prince George, British Columbia.

Barrick Gold climbed 2.3 percent to C$42.94. Bullion prices rallied 0.2 percent to $1,087.30 an ounce at the close of floor trading on the Comex division of the New York Mercantile Exchange. Prices later touched a record $1,098.50 in electronic trading after the Federal Reserve pledged to keep borrowing costs low for “an extended period,” sending the dollar lower and boosting the appeal of the metal as an alternative asset.

Gold extended this week’s rally on speculation that central banks and investors will buy it to hedge against a falling dollar. India’s central bank said this week that it bought 200 metric tons of gold from the International Monetary Fund last month at market prices. HudBay Minerals Inc., which mines and produces zinc, copper, gold and silver, soared 9.9 percent to C$15.85.

Metals Producers Advance

Teck Resources gained 1.5 percent to C$31.84, leading an advance in metals producers. Copper futures for December delivery gained 1.3 percent to $2.993 a pound in New York.

Suncor Energy Inc., Canada’s largest energy company, climbed 0.5 percent to C$35.14. Crude oil for December delivery rose 1 percent to $80.40 a barrel on the New York Mercantile Exchange after a government report showed that U.S. inventories unexpectedly dropped as imports declined to a two-month low. It was the highest close since Oct. 23. Prices are up 80 percent this year.

Magna International Inc. climbed 10 percent to C$47.34. Magna’s failed bid for General Motor Co.’s Opel division may prevent the auto-parts supplier from losing customers that would balk at buying components from a rival vehicle maker, analysts said.

Enbridge Inc. added 1.5 percent to C$42.58. Canada’s largest pipeline company reported third-quarter earnings doubled and raised its profit forecast on signs of stronger demand for shipments from the Alberta oil sands.

Agrium Inc. slipped 0.2 percent to C$51.23. The fertilizer producer seeking to take over CF Industries Holdings Inc. said third-quarter profit fell 93 percent as prices and demand declined.

To contact the reporter on this story: Mary Childs in New York at mchilds4@bloomberg.net

Last Updated: November 4, 2009 17:32 EST