Canadian stocks fell the most in two months, as gold producers dropped after Morgan Stanley cut its rating on Iamgold Corp. and Eldorado Gold Corp. and an investor sold shares of technology stock CGI Group Inc.
Iamgold and Eldorado Gold fell at least 4.2 percent. CGI Group declined 2.5 percent after investor Caisse de Depot et Placement du Quebec sold some of its shares. Detour Gold Corp. sank 7.4 percent for a seventh day of losses. Alimentation Couche-Tard Inc. rose 3 percent after reporting higher-than-estimated earnings and boosting its dividend. Royal Bank of Canada and the Bank of Nova Scotia lost more than 1.4 percent to pace declines among lenders.
The Standard & Poor’s/TSX Composite Index retreated 122.45 points, or 0.9 percent, to 13,349.77 at 4 p.m. in Toronto, for its steepest slide since September. The benchmark equity gauge has dropped 0.9 percent this month to trim its 2013 advance to 7.4 percent.
“It’s the commodities sector that’s hurt the most today, and it’s a continuing trend that Canada has been out of favor,” said Ian Nakamoto, director of research with MacDougall MacDougall & MacTier Inc. in Toronto. The firm manages about C$4.7 billion ($4.5 billion). “There’s uncertainty over energy in terms of Iran, and the potential for more supply is never good for a commodity. The mood and luster for gold just isn’t there.”
Raw-materials stocks slumped 1.4 percent as a group, the biggest decline in the S&P/TSX as nine of 10 industries retreated. Trading volume was 18 percent higher compared with the 30-day average at this time of the day.
Detour Gold, the worst-performing stock in the S&P/TSX this year, sank 7.4 percent to C$3.49, the lowest close since December 2008. The stock has slumped 37 percent in the past seven days.
Chief Executive Officer Gerald Panneton resigned yesterday without providing a reason. He will be replaced by Paul Martin, the chief financial officer, on an interim basis. Detour Gold has plunged 86 percent this year.
Eldorado Gold fell 4.5 percent to C$6.11 and Iamgold lost 4.2 percent to C$4.32. The S&P/TSX Gold Index declined 2.3 percent, a four-month low.
Morgan Stanley reduced its ratings for Eldorado Gold to equal-weight, the equivalent of a hold, from overweight, and dropped Iamgold to underweight, the equivalent of a sell.
Gold for December delivery was little changed in New York. The metal pared an earlier gain of as much as 1.3 percent after improving data on U.S. building permits and home prices.
Suncor Energy Inc. declined 1.8 percent to C$36.59 and Husky Energy Inc. lost 1.3 percent to C$29.89. Crude slipped 0.4 percent ahead of a report from the Energy Information Administration tomorrow that will probably say inventories rose 750,000 barrels last week, according to a Bloomberg survey.
Iran on Nov. 24 agreed to curtail its nuclear activities in return for easing some sanctions on oil, auto parts, gold and precious metals.
CGI Group, the information-technology company that worked on the Obamacare health exchange software, fell 2.5 percent to C$39.70. Caisse de Depot, the Quebec pension fund, will sell 9.96 million shares of CGI Group to rebalance its investment portfolio.
As part of the transaction, CGI Group will buy back C$100 million worth of the shares, or about 25 percent of those sold by the pension fund.
Royal Bank, the nation’s largest lender, decreased 1.4 percent to C$70.51 and Bank of Nova Scotia tumbled 1.6 percent to C$65.42. The S&P/TSX Banks Index slumped 1.1 percent, the most since June.
Alimentation Couche-Tard, the convenience store operator, climbed 3 percent to a record C$76.17 after reporting second-quarter adjusted earnings of $1.32 a share compared with analysts’ estimates of $1.23. The company also raised its quarterly dividend to 10 Canadian cents a share from 8.75 cents.
Chorus Aviation Inc. surged 29 percent to C$3.52, a record gain, after an arbitration panel ruled in favor of the company’s Jazz Aviation unit in a dispute with Air Canada, the nation’s largest airline.
Air Canada, the top-performing stock in the S&P/TSX this year with a 293 percent advance, slipped 0.3 percent to C$6.87.