Canada Stocks Post Worst Two-Day Drop Since January as Oil FallsEric Lam
Canadian stocks fell, completing the worst two-day slump since January, as crude oil prices declined to offset a gain in gold after U.S. employers added fewer jobs than forecast.
Element Financial Corp. and AGF Management Ltd. lost more than 1.9 percent to pace declines among financial stocks. Vermilion Energy Inc. and Enerplus Corp. fell at least 2 percent. Eldorado Gold Corp. jumped 6.9 percent after raising its production forecast. Pacific Rubiales Energy Corp. rose 5.7 percent after Bloomberg News reported executives are considering buying the company to fend off a potential outside offer.
The Standard & Poor’s/TSX Composite Index fell 115.48 points, or 0.8 percent, to 15,215.26 at 4 p.m. in Toronto, giving it a weekly decline of 1.6 percent. The index fell 1.3 percent yesterday, the first time it moved by 1 percent or more since April. The benchmark Canadian equity gauge closed at a record high on July 30.
Vermilion Energy lost 3.6 percent and Enerplus Corp. retreated 2 percent. West Texas Intermediate crude for September delivery declined 0.3 percent, falling a fifth day. Prices are down 4.1 percent this week, the biggest weekly decline in seven months. U.S. refineries cut their utilization rate last week for the first time in more than a month, according to government data.
Energy stocks in the S&P/TSX tumbled 1.4 percent as a group. Seven of 10 industries in the Canadian stock index retreated on trading volume that was 16 percent greater than the 30-day average.
Eldorado Gold jumped 6.9 percent. Gold for December delivery rose 0.9 percent to $1,294.80 an ounce in New York, after prices fell 3 percent in July as a U.S. equity rally eroded demand for the metal as a haven.
U.S. employers added 209,000 jobs in July, short of the median forecast for 230,000 additions forecast by economists. Wages and hours were unchanged from June. The jobless rate climbed to 6.2 percent as more people entered the labor force.
Pacific Rubiales added 5.7 percent for a third day of gains. Executives hired Banco Itau BBA SA and Citigroup Inc. to arrange a loan and seek partners for a possible management buyout, according to people with direct knowledge of the matter.
The plan is a defensive move after Alfa SAB, the Mexican auto parts and petrochemical company, raised its Pacific Rubiales stake more than 20 times in just over two months, the two people said asking not to be named because talks are private.