Canadian stocks fell, completing a third-straight weekly decline, after Research In Motion Ltd. (RIM) cut its earnings forecasts and oil futures dropped to the lowest level in almost four months.
RIM, the BlackBerry maker, plunged 22 percent. Royal Bank of Canada (RY), Canada’s biggest lender by assets, increased 1.2 percent after people familiar with the situation said it is in advanced talks to sell its U.S. retail unit to PNC Financial Services Group Inc. Suncor Energy Inc. (SU), Canada’s biggest oil and gas producer, declined 0.9 percent as oil slumped after the International Monetary Fund cut its estimate of U.S. growth.
The Standard & Poor’s/TSX Composite Index slipped 63.18 points, or 0.5 percent, to a seven-month low of 12,789.95, extending its weekly retreat to 2.3 percent.
“The U.S. has slowed down dramatically,” said Blair Falconer, a money manager who oversees about C$800 million ($816 million) for HSBC Securities (Canada) Inc. in Toronto. “It looks like we’re going to have an extended slow-growth period.”
The S&P/TSX sank 6.9 percent this month through yesterday as the risk of a default on Greek government debt climbed and data on employment and manufacturing trailed economists’ forecasts. The stock benchmark has tumbled 10 percent since April 5, meeting the common definition of a correction.
RIM sank 22 percent, the most since September 2008, to C$27.24. The company forecast 2012 earnings of $5.25 a share to $6 a share, excluding certain items, after estimating $7.50 a share in April. At least five analysts cut their ratings on the stock.
Celestica Inc. (CLS), which makes electronics for companies including RIM, slumped 7.5 percent, the most in two years, to C$7.91. Jim Suva, an analyst at Citigroup Inc., lowered his rating on Celestica to “sell” from “hold,” citing RIM’s outlook in a note to clients.
Royal Bank rallied 1.2 percent to C$54.33 after people who spoke on condition of anonymity said PNC is likely to prevail over a rival bid from BB&T Corp. The business may fetch as much as $3.7 billion, Peter Routledge, an analyst at National Bank Financial, said in April.
The S&P/TSX Energy Index fell to a six-month low as oil futures extended their weekly drop to 6.3 percent. Suncor declined 0.9 percent to C$37.17. Cenovus Energy Inc. (CVE), Canada’s fifth-largest energy company, lost 1.5 percent to C$32.65.
Magna International Inc. (MG), Canada’s biggest auto-parts maker, rose 5.1 percent to C$47.47 for a fifth-straight gain as lower fuel prices boosted world transportation-equipment stocks.
Fertilizer producers dropped for a second day a day after the U.S. Senate voted to eliminate a tax credit for ethanol.
Potash Corp. of Saskatchewan Inc., the world’s largest fertilizer producer by market value, decreased 2.8 percent to C$49.55. Agrium Inc. (AGU) lost 2.6 percent to C$78.01.
First Quantum Minerals Ltd. (FM), Canada’s second-biggest publicly traded copper producer, advanced 3.2 percent to C$119.01 after saying it split its shares five-to-one effective Aug 9, pending shareholder approval.
Bridgewater Systems Corp. (BWC), which makes software for wireless carriers, soared 28 percent, the most in three years, to C$8.10 after agreeing to be bought by Amdocs Ltd. for C$8.20.
Mosaid Technologies Inc. (MSD), a semiconductor developer, sank 14 percent, the most since 2005, to C$26.97 after forecasting 2012 earnings below analysts’ estimates. Brian J. Piccioni, an analyst at Bank of Montreal (BMO), and Sean Peasgood, an analyst at Wellington West Capital Inc., cut their ratings on the shares to “market perform.”
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