Canada Stocks Snap Three-Day Advance as Economic Growth Slows
Canadian stocks fell for the first time in four days after data showed the economy grew at its slowest pace since 2011 and a measure of China’s manufacturing missed forecasts.
Atlantic Power Corp. (ATP) plunged 29 percent as the electric power company cut its dividend 65 percent after reporting worse- than-estimated fourth-quarter earnings. Cenovus Energy Inc. (CVE) and Suncor Energy Inc. slumped at least 1.1 percent as the price of crude slipped to its lowest level this year.
The Standard & Poor’s/TSX Composite Index (SPTSX) fell 48.71 points, or 0.4 percent, to 12,773.12 at 4 p.m. in Toronto. The S&P/TSX rose 0.6 percent for the week.
“On the global scene you have softer PMI data in China and in the U.K.,” said Michael O’Brien, director and fund manager with TD Asset Management Inc. in Toronto. He manages about C$3 billion ($3 billion). “It’s reminding people that this isn’t a straight-line recovery, that there will be bumps in the road. There are still things that need to heal.”
The official Purchasing Managers’ Index in China was 50.1 in February, the weakest in five months and down from 50.4 in January, a report from the National Bureau of Statistics and China Federation of Logistics and Purchasing showed today in Beijing. A gauge of U.K. manufacturing based on a survey of purchasing managers slid to 47.9 last month from a revised 50.5 in January, according to Markit Economics and the Chartered Institute of Purchasing and Supply.
Canada’s gross domestic product grew at a 0.6 percent annualized pace from October to December, the slowest since the second quarter of 2011, as gains in investment and consumer spending were blunted by companies scaling back inventories.
Raw-materials companies contributed the most to losses in the S&P/TSX as seven of 10 industries retreated. Trading volume was 2.2 percent lower than the 30-day average.
Barrick Gold Corp. dropped 3.4 percent to C$30.20 after gold for April delivery fell 0.4 percent to settle at $1,572.30 an ounce in New York, capping a fourth straight week of declines.
Atlantic Power lost C$2.96 to C$7.30, for its biggest decline since listing in 2004. The company cut its annual dividend 65 percent to 40 Canadian cents a share after reporting a wider loss than analysts forecast.
Cenovus lost 65 Canadian cents to C$32.74 and Suncor slipped 35 Canadian cents to C$30.90 as crude for April delivery tumbled 1.5 percent to settle at $90.68 a barrel, the lowest level since December.
To contact the reporter on this story: Eric Lam in Toronto at firstname.lastname@example.org
To contact the editor responsible for this story: Michael P. Regan at email@example.com