Canadian Stocks Fall Most in Two Weeks Amid Europe Debt Concerns
Canadian stocks retreated from a record and joined a global selloff as signs of financial stress in Portugal increased concern that instability will return to Europe.
Crew Energy Inc. (CR) and TransGlobe Energy Corp. dropped at least 2 percent to pace declines among energy stocks. Banro Corp. (BAA) plunged 29 percent after production was significantly hampered at one of its projects as the processing plant has problems handling the ore. Fortuna Silver Mines Inc. (FVI) slumped 9.9 percent after analysts at Canaccord Genuity Corp. cut their rating for the stock.
The Standard & Poor’s/TSX Composite Index (SPTSX) fell 100.71 points, or 0.7 percent, to 15,114.48 at 4 p.m. in Toronto, the most in two weeks after reaching a record close yesterday. The benchmark Canadian equity gauge has gained 11 percent this year.
A selloff in Europe spread to North America amid concern about the missed debt payments by the parent of Banco Espirito Santo SA. The MSCI All-Country World Index, which tracks both developed and emerging markets, sank as much as 1 percent.
Crew Energy fell 2 percent to C$11.37 and TransGlobe Energy lost 2.9 percent to C$7.38. The S&P/TSX Energy Index sank 0.9 percent, reaching a one-month low as 65 of 69 members retreated.
Crude for August delivery rallied 0.6 percent to snap a nine-day decline, the longest stretch since 2009, New York Mercantile Exchange data show. Prices have fallen about 2.4 percent this month.
Manulife Financial Corp. retreated 0.9 percent to C$21.47 as financial stocks decreased 0.2 percent as a group.
Royal Bank of Canada, the nation’s second-largest lender by assets, lost 0.2 percent to C$78.34 to snap a nine-day winning streak and retreat from a record.
Fortuna Silver Mines sank 9.9 percent to C$5.83 as the S&P/TSX Materials Index slumped 1.6 percent, the most in the benchmark Canadian equity gauge. Trading volume for S&P/TSX stocks was 26 percent higher compared with the 30-day average.
John Kratochwil, analyst at Canaccord Genuity, reduced Fortuna’s rating to a hold from a buy. The company said cash costs at its Caylloma mine in Peru were higher than earlier guidance in the second quarter.
Gold for August delivery rose 1.1 percent to settle at $1,339.20 an ounce on the Comex in New York, the highest since March. Gold is seen as an safe haven alternative investment in times of increasing volatility.
To contact the reporter on this story: Eric Lam in Toronto at email@example.com