Canadian stocks were little changed as manufacturing sales unexpectedly increased last month and Federal Reserve policy makers began a two-day meeting in which they may discuss a timeline for reducing monetary stimulus.
Asanko Gold Inc., an exploration company focused on West Africa, fell 2.9 percent after it agreed to purchase PMI Gold Corp. for about C$183 million ($173 million). PMI jumped 45 percent. Constellation Software Inc. jumped 5.3 percent for a second day of gains after the company agreed to buy software company Total Specific Solutions.
The Standard & Poor’s/TSX Composite Index (SPTSX) declined 4.25 points, or less than 0.1 percent, to 13,180.16 at 4 p.m. in Toronto. The benchmark equity gauge has slid 1.6 percent this month.
“Manufacturing sales are probably a good reason why banks are up,” Ian Nakamoto, director of research at MacDougall, MacDougall & MacTier Inc., which manages about C$4.77 billion, said in a telephone interview from Toronto. “The banks’ performance is a good proxy for the economy and that seems to be the highlight today.”
Canadian manufacturing sales in October rose 1.0 percent to C$50.1 billion, Statistics Canada said today in Ottawa. The result exceeded all 15 forecasts in a Bloomberg survey of economists that had a 0.3 percent decline as the median estimate. The increase in sales was led by the largest gain by food manufacturers in two decades, as factories handled a record canola harvest.
Toronto-Dominion Bank added 0.2 percent to C$95.81. Onex Corp., a private-equity investment company, and Northern Property, a real-estate investment trust, led gains among financial companies with advances of at least 2.1 percent.
Six of the 10 main industries in the S&P/TSX gained on trading volume 5.8 percent higher than the 30-day average, led by a 1.9 percent advance in information technology companies.
The S&P/TSX Gold Index declined 0.1 percent as the metal fell for the first time in three days. Alacer Gold Corp. fell 7.1 percent to C$2.21, while OceanaGold Corp. decreased 4.3 percent to C$1.54 and Torex Gold Resources Inc. dropped 4.6 percent to C$1.05.
The Federal Open Market Committee, or FOMC, begins a two-day policy meeting today. About 34 percent of economists surveyed by Bloomberg on Dec. 6 predicted the U.S. central bank will start paring stimulus when it concludes tomorrow. Gains in manufacturing, technology and housing fueled “modest to moderate” economic growth from early October through mid-November, the central bank said in its Beige Book survey released Dec. 4.
Asanko plunged 2.9 percent to C$2.04. The company said the combination of its Esaase gold project and PMI’s neighboring Obotan projects in Ghana will have a combined 7.5 million ounces of measured and indicated gold resources. The offer is valued at C$0.44 per PMI share and is 58 percent more than Vancouver-based PMI’s closing price yesterday.
PMI rose 13 cents, its biggest gain since October 2011, to 41 Canadian cents.
Constellation increased 5.3 percent to C$217.73, the highest level since it began trading in 2006. Global Maxfin Capital Inc. analysts raised the stock to a strong buy rating from buy.
Canexus Corp., which runs oil storage facilities, rose 7.9 percent to C$6.86 after announcing progress in its rail transport operations.
To contact the editor responsible for this story: Lynn Thomasson at firstname.lastname@example.org