Canadian stocks fell the most in three weeks, after the benchmark index rose to its best annual performance in three years, as declines among energy companies and banks overshadowed a rally in gold and silver producers.
Canadian Natural Resources Ltd. and Suncor Energy Inc. retreated at least 1.2 percent as crude had the largest slump in more than a year. Detour Gold Corp. gained 11 percent after resuming milling operations at its mine. B2Gold Corp. and Silvercorp Metals Inc. rose more than 4.1 percent as precious metals prices surged.
The Standard & Poor’s/TSX Composite Index fell 27.36 points, or 0.2 percent, to 13,594.19 at 4 p.m. in Toronto, for the biggest decline since Dec. 11. The index rose 9.6 percent for 2013, its largest annual gain since 2010.
“It’s a bit of market malaise following a strong 2013, people are reassessing their portfolios,” said Brian Huen, fund manager with Red Sky Capital Management Ltd. in Toronto. The firm manages C$225 million ($212.1 million). “In the gold sector, people have stopped selling. People are looking at underperforming sectors from last year and making bets they won’t underperform like last year.”
Bank of Nova Scotia dropped 0.6 percent to C$66.01 and Toronto-Dominion Bank slipped 0.4 percent to C$98.87 as financial services stocks retreated 0.5 percent as a group. Eight of 10 industries in the S&P/TSX declined on trading volume 26 percent lower compared with the 30-day average.
Manulife Financial Corp. fell 1.1 percent to C$20.73 and Great-West Lifeco Inc. dropped 1.4 percent to C$32.28 as 35 of 46 stocks in the S&P/TSX Financials Index declined.
Canadian Natural Resources dropped 1.6 percent to C$35.35 and Suncor Energy lost 1.2 percent to C$36.79 as crude prices sank 3 percent in New York for the biggest decline in almost 14 months.
Prices fell as an improving U.S. economy added to speculation the Federal Reserve will further curb stimulus. Data today showed applications for U.S. unemployment benefits declined last week.
A government report tomorrow will probably show U.S. crude supplies fell a fifth week, a Bloomberg survey showed.
Legacy Oil & Gas Inc. lost 1.3 percent to C$6.05 and Surge Energy Inc. slumped 3.4 percent to C$6.52.
Air Canada, the best-performing stock in the S&P/TSX in 2013, retreated 2 percent to C$7.26 for a third day of losses. The stock surged 323 percent in 2013.
Detour Gold, the worst-performing stock in the benchmark equity gauge last year, jumped 11 percent to C$4.56. The company said the processing plant at its Detour Lake open pit gold mine is targeted to resume operations at a rate of 50,000 metric tons a day within a week of restart. Detour Gold had shut down the plant on Dec. 17.
Detour Gold lost 84 percent in 2013. Eight of the 10 worst-performing stocks in the S&P/TSX were gold mining companies.
B2Gold gained 4.1 percent to C$2.27 and Yamana Gold Inc. climbed 4.6 percent to C$9.58 as the price of gold jumped the most in three weeks on speculation demand for bars and jewelry will increase in Asia. Gold for February delivery rose 1.9 percent to $1,225.20 an ounce in New York. Novagold Resources Inc. surged 10 percent to C$2.97.
Silvercorp Metals surged 5.7 percent to C$2.58 and Silver Wheaton Corp. gained 5.9 percent to C$22.71 as silver rallied 3.9 percent to $20.13 an ounce.
Gold and silver prices plunged the most in more than 30 years in 2013 as investors lost faith in the metals as an alternative investment amid a U.S. equity rally and muted inflation.