Canadian stocks fell the most in a year, led by banks and commodity producers, after the U.S. Conference Board lowered its index of Chinese leading economic indicators and commodity futures dropped.
Teck Resources Ltd., Canada’s largest producer of base metals and coal, declined 5.7 percent after announcing an explosion at a coal mine in British Columbia. Suncor Energy Inc., Canada’s biggest oil and gas company, lost 4.1 percent as crude oil slumped the most since June 4. Royal Bank of Canada, the country’s biggest bank, decreased 3.1 percent as lenders retreated around the world.
The Standard & Poor’s/TSX Composite Index decreased 343.17 points, or 3 percent, the most since June 22, 2009, to a four-month low of 11,263.83.
“The market seems to be spooked,” said Greg Taylor, who helps oversee C$4.5 billion ($4.28 billion) at Aurion Capital Management in Toronto. “The one thing that was going to save global growth was China, and now there’s questions if that is sustainable.”
The S&P/TSX has dropped 5.6 percent since June 21 as the sales of new and existing U.S. homes failed to meet economists’ estimates, speculation of a European sovereign debt default increased and energy futures declined on weather forecasts. For the quarter, the index is down 6.4 percent.
The Conference Board said China’s leading economic indicators increased 0.3 percent in April, less than the 1.7 percent gain it reported on June 15. The organization cited a calculation mistake on construction statistics for the error in its original number.
Stocks extended their decline after the Conference Board’s monthly index of U.S. consumer confidence retreated more than most economists expected.
All but one of 41 S&P/TSX financial stocks dropped. Royal Bank declined 3.1 percent to a 10-month low of C$51. Toronto-Dominion Bank, which has 1,039 branches in the U.S., lost 3 percent to C$68.59. Manulife Financial Corp., which got 54 percent of its revenue from the U.S. last year, decreased 5.4 percent to C$15.38, the lowest price since April 2009.
The Thomson Reuters/Jefferies CRB Index of commodities fell 2.8 percent, the most since August 2009. Copper dropped 5.1 percent in New York. China is the biggest user of the base metal.
First Quantum Minerals Ltd., Canada’s second-biggest copper producer, declined 6.4 percent to C$54.50. Western Coal Corp., whose products are used in Asian steel mills, led the S&P/TSX with a 12 percent slump to C$4.16.
Teck tumbled 5.7 percent to C$31.77 after saying the explosion at its Greenhills coal mine caused “extensive” damage to one of the buildings there. Earlier today, the stock fell as low as $30.43, which would have been the lowest closing price in eight months.
Concern that the Chinese economy will slow also weighed on crude oil, as China is the world’s second-biggest energy consumer. Oil futures retreated 3 percent to C$75.94 a barrel, while natural gas slumped 3.8 percent.
Suncor lost 4.1 percent to C$31.65. Canadian Natural Resources Ltd., Canada’s second-biggest energy company by market value, slipped 3.3 percent to C$35.05. Talisman Energy Inc., an oil and gas producer with operations in North America, the North Sea and Indonesia, decreased 4.1 percent, the most in 11 months, to C$16.23.
BlackBerry maker Research In Motion Ltd. retreated 4.4 percent to a 15-month low of $52.41. Verizon Communications Inc. will start selling Apple Inc.’s iPhone next year, breaking AT&T Inc’s exclusive hold on the device in the U.S., two people familiar with the plans said.
Potash Corp. of Saskatchewan Inc. fell for a fourth day, slumping 2.6 percent to an eight-month low of C$92.60. Bank of Nova Scotia analyst Sam Kanes reduced his share-price estimate on the stock to C$138 from C$150.