Canadian Stocks Fall as Materials Slip Amid Europe Summit
Canadian stocks declined, after a two-day advance for the benchmark index, as raw-material companies and banks fell as European leaders began a two-day summit on the debt crisis.
The three largest banks in Canada, Royal Bank of Canada (RY), Toronto-Dominion, and Bank of Nova Scotia, lost at least 1.1 percent. Goldcorp Inc. (G) and Barrick Gold Corp. dropped more than 1.7 percent as the metal slid. Energy shares rose the most in the Standard & Poor’s/TSX Composite Index. Progress Energy Resources (PRQ) Corp. surged 74 percent after agreeing to be bought by Petroliam Nasional Bhd, Malaysia’s state-owned oil and natural- gas company, for C$4.8 billion ($4.67 billion) in cash.
The S&P/TSX lost 82.28 points, or 0.7 percent, to 11,328.66 at 2:45 p.m. in Toronto. The benchmark index is down 1.6 percent for June, heading for a fourth straight month of declines. It has dropped 8.6 percent for the quarter.
“We’re floundering. Until something happens in Europe, the equity markets are going to stay under a cloud,” said Rick Hutcheon, president of Toronto-based RKH Financial, in a phone interview.’’
Gold declined 1.6 percent while oil fell for the first time in two days amid signs of slowing U.S. growth. The number of applications for U.S. unemployment benefits hovered last week near the highest level of the year, the Labor Department said. Concern about a worsening of Europe’s fiscal crisis and a global slowdown dominates as the region’s leaders meet in Brussels for the first of a two-day summit.
Tahoe Resources Inc. (THO) plunged 19 percent to C$13.14, dropping as much as 40 percent before trading on its stock was briefly halted. The developer of the Escobal silver mine in Guatemala tumbled after Mineweb reported that the government proposed taking stakes in mining companies operating in the country, citing newspaper Prensa Libre.
“We haven’t heard anything officially from the government,” Ira Gostin, a spokesman for Reno, Nevada-based Tahoe, said in a telephone interview.
Centerra Gold Inc. (CG) lost 28 percent to C$7.10. The owner of the Kumtor mine in Kyrgyzstan said it believes a parliamentary resolution calling for changes to the agreements governing the project isn’t legally binding. The company dropped 26 percent on June 22 after the company said the parliamentary report alleged Centerra’s operations had caused environmental damage.
Royal Bank, the largest lender in Canada, dropped 1.3 percent to C$50.71. Toronto Dominion (TD), the second largest, declined 1.1 percent to C$78.23 and Bank of Nova Scotia (BNS) lost 2 percent to C$51.96, snapping two days of gains.
Progress Energy, a Calgary-based oil and natural gas producer, jumped 74 percent to C$20.07. Petronas Chief Executive Officer Shamsul Azhar Abbas said March 30 he wants to expand the company’s presence in Canada and Australia. The company bought a stake in three of Progress Energy’s gas fields last year and agreed to explore development of a liquefied natural gas terminal to export the fuel.
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