Canadian Stocks Drop for Fourth Day as Commodity Shares RetreatEric Lam
Canadian stocks slid for a fourth day, the longest stretch in seven weeks, as commodities fell after China ordered companies to cut excess production capacity.
Advantage Oil & Gas Ltd. lost 5.9 percent as crude posted a weekly decline. Dundee Precious Metals Inc. retreated 2.8 percent as the price of gold slipped. Celestica Inc., an electronics manufacturer, surged 6.3 percent after second-quarter profit topped analysts’ estimates. Canfor Corp., a lumber and paper producer, jumped 7.3 percent for the biggest gain in two years on better-than-expected earnings.
The Standard & Poor’s/TSX Composite Index fell 21.24 points, or 0.2 percent, to 12,647.90 at 4 p.m. in Toronto. The gauge fell 0.3 percent this week, the first decline in five weeks. Trading volume was 25 percent lower than the 30-day average.
“We’re waiting for more earnings,” said Irwin Michael, a fund manager with ABC Funds in Toronto. His firm manages C$800 million ($778 million). “Oil is lower and copper is down. People are a little nervous.”
Six of 10 industries in the S&P/TSX retreated, led by a 0.9 percent decline in oil and gas producers. The S&P/TSX Energy Index slumped to a two-week low as 42 of 58 stocks fell.
China ordered more than 1,400 companies in 19 industries to cut excess production capacity this year. Steel, ferroalloys, electrolytic aluminum and cement are among areas affected, the Ministry of Industry and Information Technology said this week.
Advantage Oil & Gas slumped 5.9 percent to C$3.70 and Canadian Natural Resources Ltd. retreated 4.5 percent to C$32.20. Crude for September delivery dropped 0.7 percent to settle at $104.70 a barrel in New York. Oil fell 3.1 percent this week for the first weekly drop in more than a month.
Dundee Precious Metals sank 2.8 percent to C$5.21. Gold for December delivery declined 0.6 percent to settle at $1,321.90 an ounce in New York.
First Majestic Silver Corp. lost 1.7 percent to C$13.32 and Silver Wheaton Corp. slipped 0.5 percent to C$23.76 as silver fell 1.9 percent.
Potash Corp. of Saskatchewan Inc. fell 0.6 percent to C$38.14, extending losses for a fourth day. Raymond James Financial Inc. analyst Steven Hansen lowered his rating for the stock to market perform from outperform.
Yesterday, the fertilizer producer cut its earnings forecast and reported profit that missed analysts’ estimates after a drop in potash prices.
Celestica soared 6.3 percent to C$10.40. The company said third-quarter earnings may reach 17 cents to 23 cents a share, compared with analysts’ estimates for 20 cents a share.
Canfor, based in Vancouver, rallied 7.3 percent to C$21.45, the biggest gain since July 2011. The company posted second-quarter adjusted profit of 61 Canadian cents a share, topping the 38-cent average of eight analysts surveyed by Bloomberg. Lumber production and shipments increased during the quarter.