Canadian stocks fell for a third day, led by energy companies, as gold futures dropped to a five-week low and crude oil failed to rebound from yesterday’s 4.6 percent plunge.
Goldcorp Inc., the world’s second-biggest gold producer by market value, fell 2.8 percent as concern Greece’s debt crisis will spread to other European countries boosted the U.S. dollar. Nexen Inc., an oil and gas producer with operations on five continents, lost 2 percent a day after the International Energy Agency said it will release of 60 million barrels of crude.
The Standard & Poor’s/TSX Composite Index slipped 70.69 points, or 0.5 percent, to 12,908.89 at 4 p.m. in Toronto. It gained 0.9 percent this week.
“Two things are going on: The risk trade is starting to come off a bit -- when that happens there’s a movement toward safer currencies such as the U.S. dollar -- and then the worry that Greece is going to default,” said Tony Demarin, chief investment officer at BCV Asset Management in Winnipeg, Manitoba, which oversees C$300 million ($305 million).
The S&P/TSX broke a three-week losing streak as investors speculated Greece will be able to enact austerity measures and avoid default. European leaders meeting in Brussels today attempted to stanch the crisis, vowing to stave off a Greek default as long as Prime Minister George Papandreou pushes through a package of budget cuts next week.
Base-metals producers climbed this week, while gold companies rebounded from a two-year low relative to prices of the metal.
Gold and silver retreated today as the U.S. dollar gained for a third day against a basket of world currencies. The cost to insure against a sovereign-debt default in Europe rose to a record as Moody’s Investors Service said it may cut its ratings on 13 Italian banks.
Goldcorp fell 2.8 percent to C$46.24. Silver Wheaton Corp., Canada’s fourth-largest precious-metals company by market value, dropped 3.4 percent to C$31.34. Iamgold Corp., which mines in West Africa, South America and Quebec, lost 4.4 percent to C$17.73, a five-month low.
Crude oil futures have fallen four straight weeks.
“The rest of the world seems to believe we need lower oil prices in order for the economy to start growing again,” Demarin said. “Opening up the petroleum reserve is something they don’t do all that often.”
Nexen declined 2 percent to C$19.49, extending its three-day drop to 5.6 percent. Canadian Natural Resources Ltd., the country’s second-largest energy company by market value, slipped 1.6 percent to C$38.26.
Niko Resources Ltd., which produces energy in South Asia, lost 3.2 percent to C$62.85 after agreeing to plead guilty to a Canadian charge of bribing a Bangladeshi official. The shares closed at the lowest level since May 2009.
Copper futures advanced as much as 2.5 percent in New York after the U.S. reported a bigger increase in durable-goods orders for May than most economists had forecast.
First Quantum Minerals Ltd., Canada’s second-largest publicly traded copper producer, climbed 3.2 percent to C$127.45. Teck Resources Ltd, the country’s biggest base-metals and coal producer, rose 0.9 percent to C$45.95.
BlackBerry maker Research In Motion Ltd. decreased 3.1 percent to C$28.23, trimming its weekly gain to 3.6 percent. Speculation that RIM may be acquired is unwarranted, Kris Thompson, an analyst at National Bank of Canada, said in a note to clients.