Canada Stocks Snap Four Days of Gains as Bank of Montreal Drops

Canadian stocks fell, snapping four days of gains, as raw-material producers declined and Bank of Montreal (BMO) reported lower-than-estimated profit.

Bank of Montreal sank 3.6 percent, the most since 2011, to pace declines among financial stocks. First Quantum Minerals Ltd. (FM) dropped 0.6 percent as copper fell for a second day. Peregrine Diamonds Ltd. soared 50 percent, the most in four years, after finding diamonds in bulk sample testing.

The Standard & Poor’s/TSX Composite Index fell 109.44 points, or 0.8 percent, to 13,310.13 at 11:35 a.m. in Toronto. The benchmark equity gauge has risen 7.6 percent this year, the third-worst performer among developed markets ahead of Hong Kong and Singapore.

“The banks are down, that’s the leading the market down,” said Irwin Michael, fund manager with ABC Funds in Toronto. The firm manages about C$850 million ($796.7 million). “Bank of Montreal, the fact is it’s had a good run.”

Financial stocks tumbled 1 percent as a group, the most in the S&P/TSX. Nine of 10 industries declined on trading volume 22 percent higher compared with the 30-day average at this time of the day.

Bank Earnings

Bank of Montreal, Canada’s fourth largest lender, sank 3.6 percent to C$70.90, the most in two years. The company said net income for the period ended Oct. 31 was C$1.09 billion, or C$1.62 a share, little changed from C$1.08 billion, or C$1.59, a year earlier.

“While the headline looks strong, BMO reported a C$121 million gain in wealth management that is not recurring and will not likely be treated as core in the market,” John Aiken, a financials analyst with Barclays Capital Inc., said in a note to clients.

Royal Bank of Canada, the nation’s largest lender, dropped 1 percent to C$69.74. Toronto-Dominion Bank, the second-largest, lost 1 percent to C$95.90.

Royal Bank, Toronto-Dominion and Canadian Imperial Bank of Commerce are scheduled to report third-quarter earnings on Dec. 5.

First Quantum Minerals lost 0.6 percent to C$17.14 and Copper Mountain Mining Corp. sank 5.4 percent to C$1.41 as copper for March delivery fell 0.5 percent in New York. Prices have retreated 13 percent this year, set for a second annual drop in three years.

Legacy Oil & Gas Inc. advanced 2.5 percent to C$6.25 after Chief Executive Officer Trent Yanko said his company was a “very attractive acquisition target” in an interview with Bloomberg.

Peregrine Diamonds soared 50 percent to 63 Canadian cents a share, the most since September 2009, after reporting a diamond grade of 2.7 carats a tonne from testing at its Chidliak project in Nunavut. The testing recovered about 600 carats of commercial-size diamonds, including a “significant portion” of gem diamonds, the company said in a statement.

To contact the reporter on this story: Eric Lam in Toronto at elam87@bloomberg.net

To contact the editor responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net

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