Canadian stocks fell the most in over a week as materials and energy shares declined after manufacturing shrank in the euro-area and China and the French election heightened concern over Europe’s sovereign debt crisis.
Barrick Gold Corp., the world’s largest producer of the metal, dropped 1.7 percent. First Quantum Minerals Ltd., Canada’s second-largest publicly traded copper producer, declined 5.3 percent. MEG Energy Corp., a Calgary-based oil-sands developer, fell 2.1 percent. Baja Mining Corp., which is building the Boleo copper and cobalt mine in Mexico, plummeted 37 percent after saying the project’s cost may be 22 percent higher than forecast.
The Standard & Poor’s/TSX Composite Index decreased 158.33 points, or 1.3 percent, to 11,988.95 in Toronto, its biggest drop since April 13.
“It’s the European numbers, plus another data point confirming that China is slowing,” Jennifer Radman, a money manager at Caldwell Investment Management Ltd. in Toronto, said in a telephone interview. The firm oversees about C$1 billion ($1 billion). “It’s a very widespread sell-off. Risk is coming out of the market due to those factors.”
The S&P/TSX had its first weekly gain in almost two months in the five days ending April 20, snapping its longest losing streak since 2008. Canadian stocks rallied after the International Monetary Fund and the Bank of Canada said economic growth would be faster than previously forecast.
Materials companies fell, driven by metals producers. Copper headed for its biggest loss in more than a week in New York on concern that demand will slow as manufacturing contracts in China, the world’s biggest copper user. The metal also fell on concern that the outcome of French and Dutch elections will disrupt efforts to stem the region’s debt crisis.
Teck Resources Ltd., Canada’s biggest base-metal producer, decreased 3.7 percent to C$35.33.
First Quantum declined 5.3 percent to C$19.83 after being lowered to sector performer from sector outperformer at Canadian Imperial Bank of Commerce, which cited lowered gold and nickel price forecasts for 2012 and 2013. The rating means that the stock is expected to perform in line with its sector during the next 12 to 18 months.
Baja Mining plunged 37 percent, the biggest drop in more than nine years, to 57 Canadian cents. The Boleo project may cost an additional C$246 million after exhausting contingency and cost-overrun facilities, the Vancouver-based company said today in a statement.
Gold declined to a two-week low as a stronger U.S. dollar curbed demand for the metal as an alternative investment. Silver slumped to a three-month low.
Barrick Gold dropped 1.7 percent to C$39.29. Goldcorp Inc., the world’s second-biggest bullion miner, fell 3.4 percent to C$39.65. Silver Wheaton Corp., the country’s third-biggest precious-metals company by market value, decreased 3.6 percent to C$28.12.
Energy stocks in the S&P/TSX fell as oil declined the most in two weeks after preliminary reading of a purchasing managers’ index in China fanned concern that fuel consumption will diminish.
MEG Energy Corp. declined 2.1 percent to C$37.65. Cenovus Energy Inc., Canada’s fifth-largest energy company, dropped 1.2 percent to C$34.20.
Financial shares in the benchmark gauge also decreased for a second day. Toronto-Dominion Bank, the country’s second-largest lender, fell 1.4 percent to C$82.81.