Canada Stocks Little Changed as Teck Gains While Gold, Oil Fall
Canadian stocks were little changed, after reaching a record yesterday, as Domtar (UFS) Corp. sank on worse-than-forecast earnings and commodities prices retreated.
Domtar, the pulp and paper manufacturer, plunged 7.1 percent as downtime at their mills led to higher unit costs. Teck Resources added 1.3 percent after reporting coal production costs will be lower than previously forecast. Potash Corp. of Saskatchewan Inc. added 0.3 percent after raising its full-year earnings forecast on higher Chinese demand for its fertilizer. Alacer Gold Corp. and OceanaGold Corp. fell at least 4.3 percent as gold declined to a five-week low.
The Standard & Poor’s/TSX Composite Index (SPTSX) rose less than a point to 15,394.45 at 4 p.m. in Toronto. The equity index trades at 20.8 times earnings, the highest level since 2010.
Six of 10 industries in the S&P/TSX rose on trading volume 3.1 percent lower than the 30-day average.
Pacific Rubiales Energy Corp. slipped 0.8 percent to C$20.30. Bond investors are becoming increasingly concerned Pacific Rubiales will fail to strike a deal with Colombia’s state-owned Ecopetrol SA to continue drilling at the Rubiales field after its contract expires in 2016.
Domtar sank 7.1 percent to C$41.64, the biggest decline since April 2013, after the company said it took lack-of-order downtime totaling 51,000 tons of paper which resulted in higher unit costs.
Teck Resources, Canada’s largest diversified mining company, rose 1.3 percent for a fourth day of gains after it said its coal mining costs will be 5 percent lower than previously expected this year after job cuts. A ton of coal will cost $52 to $57 to produce, down from an earlier estimate of $55 to $60, Teck said in a statement. Teck expects to produce 6 million metric tons of coal in the third quarter.
Rogers Communications Inc., the nation’s largest wireless carrier, rose 1.1 percent to C$42.88 as the company met analysts’ estimates amid a turnaround plan to return to growth.
Talisman Energy Inc. dropped 1.8 percent to C$11.76 and Crew Energy Inc. fell 1.1 percent to C$10.35. Crude for September delivery slipped 1 percent in New York after gasoline inventories expanded a third week in the U.S.
Bombardier Inc. (BBD/B) dropped 1.1 percent to C$3.70, falling for a third day. The aircraft manufacturer will slash about 1,800 jobs from its aerospace business and split the unit into three, in a move to cut costs and improve operations. Bombardier eliminated 1,700 jobs in January, after the company postponed the commercial debut of its CSeries jet for a fourth time.
To contact the reporter on this story: Eric Lam in Toronto at firstname.lastname@example.org