Canada Stocks Fall as U.S. Dollar Gains, Gold Drops From Record

Canadian stocks fell for the first time in four days as materials producers dropped the most in three weeks as the U.S. dollar surged.

Eldorado Gold Corp., the country’s fifth-biggest gold producer by market value, lost 5.6 percent as the U.S. dollar gained against 14 of 16 other major currencies. Toronto-Dominion Bank, Canada’s second-largest lender by assets, declined 1.3 percent after a Canadian Imperial Bank of Commerce analyst said the industry is in a “sluggish operating environment.” BlackBerry maker Research In Motion Ltd. declined 2.3 percent after Shaw Wu, an analyst at Kaufman Bros. LP, cut his rating on the shares.

The Standard & Poor’s/TSX Composite Index slumped 135.85 points, or 1 percent, the most since Aug. 24, to 12,916.63. The stock benchmark had jumped 3.9 percent from Oct. 27 to yesterday, while the Thomson Reuters/Jefferies CRB Commodity Price Index rose 5.4 percent, as the U.S. Federal Reserve announced a $600 billion asset-buying program, weakening the U.S. currency, and U.S. employment increased more than most economists forecast.

“The market’s had a heck of a run,” said Irwin Michael, a money manager at ABC Group of Funds, which oversees C$1 billion ($995 million) in Toronto. “Now we have to see the meat and potatoes. It can’t only be the Fed. We’d like to see continuation of good corporate earnings. We’d like to see the economy pick up. We’d like to see a little better hiring like we saw last week, such that it’s not a one-month wonder.”

Dollar Gains

The U.S. dollar gained the most in three weeks against a basket of world currencies today after an auction of 10-year Treasuries drew the lowest demand since February.

Gold declined after settling at a record high, while silver plunged 10 percent from the intraday high in less than three hours in New York.

Eldorado Gold lost 5.6 percent to C$18. Silver reseller Silver Wheaton Corp. decreased 8.1 percent to C$32.53 after jumping 19 percent in the previous three days. Silvercorp Metals Inc., which mines in China, retreated for the first time in nine days, tumbling 8.9 percent to C$11.60.

Golden Star Resources Ltd., which produces gold in Africa, tumbled 18 percent, the most since 2008, to C$4.93 after announcing a third-quarter loss. All eight analysts in a Bloomberg survey had forecast a profit.

The S&P/TSX Financials Index fell for the first time in five days after CIBC analyst Robert Sedran told clients “the near-term upside is limited” among Canadian banks.

Banks Retreat

Toronto-Dominion declined 1.3 percent to C$73.65. CIBC, the country’s fifth-biggest lender by assets, lost 1.4 percent to C$77.62. Bank of Montreal, the No. 4 bank, decreased 2.3 percent to C$59.37 after Sedran cut its rating to “sector perform” from “sector outperform.”

RIM, Canada’s largest technology company, retreated 2.3 percent to C$55.46 after Kaufman’s Wu said Apple Inc.’s iPhone and Google Inc.’s Android mobile operating system may crowd BlackBerry out of the smartphone market.

AT&T Inc. has cut the price of the BlackBerry Torch in half. Kate Tellier, a spokeswoman for the carrier, said AT&T is “pleased with the business and consumer response to the Torch.”

Cameco Corp., the world’s second-largest uranium producer, climbed 3.2 percent to C$37.13 after RBC’s Fraser Phillips boosted his rating on the shares to “outperform” from “sector perform.” In a note to clients, Phillips said China’s increased target for nuclear-power generation has “changed the market dynamics” for uranium.

Missing Estimates

PetroBakken Energy Ltd. and Jazz Air Income Fund retreated a day after reporting financial results that trailed the average analyst estimate.

PetroBakken, which explores for oil and gas in Canada, decreased 6.9 percent to C$21.93 after missing the average profit estimate of six analysts by 33 percent, excluding certain items. Jazz Air, the regional carrier that flies on behalf of Air Canada, slumped 6 percent to C$5.32 after its earnings came up 6.3 percent short of the average of five analyst forecasts, excluding certain items.

CGI Group Inc., Canada’s biggest computer-services provider, surged 9.9 percent to a 10-year high of C$17.07. The company reported fourth-quarter profit that, excluding certain items, beat the average of 13 analyst estimates by 11 percent.

Quebecor Inc., the owner of the Toronto Sun, rose 4.9 percent to C$37.29. Its third-quarter earnings beat the average of 11 analyst forecasts by 6.3 percent, excluding certain items.

Equinox Minerals Ltd., which produces copper in Africa, plunged 9.4 percent to C$5.79 after First Quantum Minerals Ltd. said it sold its 16 percent stake in the company. First Quantum said it derived proceeds of about C$653 million from the sale of 114.1 million Equinox shares.

To contact the reporter on this story: Matt Walcoff in Toronto at mwalcoff1@bloomberg.net

To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net.

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