The sustained slump in global commodity prices has pushed Canadian stocks to the longest losing streak in two years.
Encana Corp. tumbled 8.6 percent after the company posted a wider operating loss than estimated. Baytex Energy Corp. decreased 8.2 percent as U.S. crude traded in a bear market. Valeant Pharmaceuticals International Inc. lost 1 percent to snap a two-day gain after overtaking Royal Bank of Canada as the nation’s largest company by market value.
Producers of energy and raw materials, which account for about 30 percent of the equity benchmark, are the worst-performing stocks in Canada this year amid a rout in commodities on concern global economic growth is slowing. The Bloomberg Commodity Index of 22 raw materials dropped 1.2 percent for a third day of declines, extending a 13-year low.
The Standard & Poor’s/TSX Composite Index fell 79.13 points, or 0.6 percent, to 14,186.24 at 4 p.m. in Toronto, a sixth straight decline. The gauge has fallen 3.5 percent, to a January low, during its current six-day slide, the longest streak since June 2013 and is now lower by 3.1 percent on the year.
Suncor Energy Inc. dropped 1.7 percent and Canadian Oil Sands Ltd. sank 5.9 percent as energy producers lost 1.3 percent as a group to an April 2009 low. Six of 10 industries in the S&P/TSX retreated on trading volume 27 percent higher than the 30-day average.
Encana tumbled 8.6 percent, extending a July 2002 low. The company’s full-year production forecast doesn’t seem to be achievable, BMO Capital Markets analyst Randy Ollenberger said in a note.
Encana was also expected to announce staff cuts of about 200 people, the Globe and Mail reported, according to an internal memo.
Companies in the benchmark equity gauge are expected to report a 39 percent slump in earnings per share in the latest earnings season, the worst in six years, according to data compiled by Bloomberg. More than 200 companies in the S&P/TSX are set to report earnings by the end of August.
Teck Resources Ltd. slumped 6.8 percent and First Quantum Minerals Ltd. lost 2.3 percent as copper touched the lowest price since 2009. Chinese preliminary manufacturing data from Caixin Media and Markit Economics unexpectedly fell to the lowest in 15 months.