Canadian Stocks Decline as Mining, Financial Shares Retreat
Canadian stocks fell for the fourth time in five days as raw materials and bank shares declined.
Avion Gold Corp. (AVR) dropped 5.4 percent as shareholders voted on Endeavour Mining Corp.’s C$389 million ($397 million) offer to purchase the company. Alacer Gold Corp. fell 5.2 percent as the price of the metal fell for the first time in three days.
The Standard & Poor’s/TSX Composite Index (SPTSX) fell 51.63 points, or 0.4 percent, to 12,182.32 at 12:38 p.m. in Toronto. The benchmark equity gauge is down 1.9 percent this week, on pace for its third weekly loss in the past four.
Mining and financial stocks contributed most to losses on the S&P/TSX as all 10 groups declined. Gold for December delivery slipped 0.5 percent to $1,762.40 an ounce in New York, extending the weekly decline to 1 percent.
“That magic number of $1,800 looks like it’ll be hard to break through,” said Ian Nakamoto, director of research with MacDougall MacDougall & MacTier Inc., in an interview from Toronto. The firm manages about $4 billion. “People also may be disappointed by earnings and the poor outlook.”
Companies in Canada and the U.S. began reporting third- quarter earnings this week, with Alcoa Inc. posting results that included a weakening aluminum outlook on an economic slowdown in China. Nakamoto said he was surprised the sentiment is so poor as he had expected weak earnings to be priced into the markets already.
Avion Gold lost 5.4 percent to 88 Canadian cents. The company said shareholders voted overwhelmingly in support of the offer from Endeavour Mining to buy the company.
Alacer Gold (ASR) slumped 5.2 percent to C$6.20 and Centerra Gold Inc. fell 2.7 percent to C$11.93. Barrick Gold Corp. retreated 1.5 percent to C$38.46 as gold futures declined amid concern that demand for bullion has weakened in China, the world’s largest buyer after India. Gold imports from Hong Kong fell 29 percent in August from July amid a seasonal slowdown and as higher prices deterred buyers, data from the Census and Statistics Department of the Hong Kong government show.
OceanaGold Corp. (OGC) rose 2.7 percent to C$3.44 after announcing it has signed an agreement with commodity trader Trafigura for the sale and purchase of copper concentrate from the mining company’s Didipio project in the Philippines.
Cenovus Energy Inc. (CVE) lost 0.7 percent to C$33.27 as crude for November delivery fell 0.7 percent to $91.46 a barrel in New York, erasing earlier gains of as much as 0.6 percent. Prices are up 1.8 percent this week.
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