Canadian stocks fell for a third day, led by raw material producers, as Potash Corp. of Saskatchewan Inc. slipped on an analyst rating cut and Teck Resources Ltd. (TCK/B) slumped along with copper prices.
Potash Corp., the world’s largest fertilizer producer, dropped 4.6 percent after Citigroup Inc. cut the shares to “hold” from “buy.” Teck Resources declined 3.5 percent as copper slid on concern higher oil prices will slow the global economic recovery. First Quantum Minerals Ltd. (FM) fell 5.6 percent.
The Standard & Poor’s/TSX Composite Index declined 128.26 points, or 0.9 percent, to 13,884.71 in Toronto.
“At the beginning as oil prices go higher, energy producers benefit,” said Marcus Xu, director of equity investments at Genus Capital Management in Vancouver, which manages C$1.7 billion ($1.8 billion). “But you have to think about the other side as well, which is how higher oil prices will impact the consumer.”
A subgroup of materials producers in the Canadian benchmark equity index has dropped 4.5 percent this week. Copper futures have dropped 9.4 percent since Feb. 14. Oil soared 23 percent in the same period.
Crude oil fell for a second day in New York after the U.S. reported a surge in supplies at Cushing, Oklahoma, the delivery point for West Texas Intermediate, the U.S. benchmark grade. Brent oil traded in London climbed as Libyan leader Muammar Qaddafi stepped up attacks on insurgents.
Futures rose as much as 0.9 percent before erasing gains after Cushing supplies climbed 1.69 million barrels to 40.3 million last week, the highest level since the Energy Department began gathering data at the hub. Oil climbed earlier as Libyan government forces launched air and artillery strikes on central oil ports to halt a rebel advance.
“Even if the Libyan situation settles, there are still other countries to worry about,” Xu said. “The unrest in the Middle East isn’t going away anytime soon.”
A group of gold producers in the S&P/TSX Index fell for a third day, declining 1.3 percent. Barrick Gold Corp. (ABX) slumped 1.6 percent to $49.99, while Goldcorp Inc. (G) sank 1.6 percent to C$47.12.
Potash Corp. fell 4.6 percent to C$54.06 after Citigroup Inc. cut its rating, citing a lack of catalysts to drive the shares higher.
Teck, Canada’s largest base-metals producer, fell 3.5 percent to C$50.87, after copper for May delivery fell 2.9 percent on concern demand may wane as higher energy costs slow the global economy. First Quantum Minerals Ltd., the country’s second-largest publicly traded copper producer, fell 5.6 percent to C$111.92.
Cineplex Inc. advanced 1.8 percent to C$23.30. The company that owns interests in Canadian movie theaters was raised to “outperform” from “market perform” at Raymond James Securities. The 12-month price estimate is C$25.
Aastra Technologies Ltd. (AAH) gained 3.3 percent to C$24.05, after the maker of telecommunications equipment was raised to “buy” from “hold” at TD Newcrest Inc. The 12-month price estimate is C$32.
TMX Group Inc., the owner of the Toronto Stock Exchange and the Montreal Exchange derivatives market, dropped 2 percent to C$39.07 after Toronto-Dominion Bank and other Canadian lenders expressed concern about the proposed sale of TMX Group to London Stock Exchange Group Plc because the country will cede regulatory control of its main stock exchange.
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