Canadian stocks fell the most in a month, ending a four-day streak of gains, as declining oil prices dragged down energy producers and Goldcorp Inc. dropped after making a bid for Osisko Mining Corp. (OSK)
Goldcorp, the world’s second-largest producer of the metal, dropped 1 percent after offering to buy Osisko for about C$2.6 billion ($2.38 billion) in cash and shares. Osisko surged 21 percent. Savanna Energy Services Corp. lost 5.8 percent to lead declines among energy stocks. Fortuna Silver Mines Inc. (FVI) added 11 percent after its silver production guidance was 30 percent higher than the previous year.
The Standard & Poor’s/TSX Composite Index (SPTSX) fell 66.04 points, or 0.5 percent, to 13,681.48 at 4 p.m. in Toronto, the biggest decrease since Dec. 11. The gauge had rallied 1.9 percent in the previous four sessions.
“The oil stocks are looking weak today,” said David Cockfield, a fund manager with Northland Wealth Management in Toronto. The firm manages about C$250 million. “This is the way it’s going to be, not huge leaps forward. There’s some waiting for fourth-quarter earnings and a quiet edging upwards of the market to get us through 14,000.”
Energy stocks dropped 1.1 percent as a group, the most in a month, as eight of 10 industries in the S&P/TSX retreated. Trading volume was 91 percent above the 30-day average.
Goldcorp slumped 1 percent to C$25.04 after it made an unsolicited offer to buy Osisko in a deal that would add 10 million ounces of gold reserves and make it the largest producer in Quebec. Osisko surged 21 percent to C$6.24.
As part of the proposed deal, Goldcorp would pay 0.146 Goldcorp shares plus C$2.26 cash for each Osisko share, valuing the company at C$5.95, a 15 percent premium based on Jan. 10 closing prices.
Lightstream Resources Ltd. fell 4.8 percent to C$5.81 and Savanna Energy Services dropped 5.8 percent to C$7.83, the biggest plunge in two years.
West Texas Intermediate crude declined as much as 1.2 percent. Iran agreed to curtail its nuclear program starting Jan. 20 under terms of a deal that will ease some sanctions on OPEC’s fifth-biggest oil producer, bringing additional supply to market.
Surge Energy Inc.lost 3.2 percent to C$6.34. The company agreed to acquire light oil producing assets in southeast Saskatchewan for C$109 million, paid for in part by issuing C$70 million worth of subscription receipts convertible to common stock.
BlackBerry Ltd. sank 4.7 percent to C$9.11 to snap five days of gains, the longest winning streak for the stock since August. BlackBerry had rallied 18 percent in that period.
John Chen, Chief Executive Officer at the Waterloo, Ontario-based smartphone maker, hired Eric Johnson for BlackBerry’s top sales job. Johnson was a colleague of Chen’s at SAP AG.
Finning International Inc. (FTT), which sells, finances and services Caterpillar construction equipment, slumped 4.1 percent to C$26.22. Ben Cherniavsky, analyst with Raymond James Ltd., lowered his rating for the stock from “strong buy” to “outperform,” the equivalent of a buy. Cherniavsky lowered his rating as the stock has rallied more than the benchmark gauge since his last change.
Fortuna Silver Mines climbed 11 percent to C$3.64, the highest close since November, after reporting 2013 silver production of 4.6 million ounces from its two underground silver mines in Mexico and Peru and introduced 2014 guidance for 6 million ounces of silver, a 30 percent increase.
Centerra Gold Inc. added 4.5 percent to C$4.86 after reporting 2013 gold production of 690,720 ounces across its mines in the Kyrgyz Republic and in Mongolia.
“Both operations exceeded the company’s 2013 production guidance,” said Ian Atkinson, chief executive officer of Centerra, said in a release.
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