Canadian Stocks Fall as Commodities Producers Tumble on ChinaEric Lam
Canadian stocks fell, a session after raw-materials producers had their strongest gains this year, as China’s currency devaluation prompted a selloff in commodities.
Miners declined amid speculation that resources demand will slow amid signs of decelerating growth in China, the world’s biggest consumer of energy and metals. Equities pared declines in the final 90 minutes of trading, as a rout in energy producers eased even as crude settled at the lowest level in six years.
The Standard & Poor’s/TSX Composite Index fell 51.72 points, or 0.4 percent, to 14,414.67 at 4 p.m. in Toronto, trimming a drop of 1.4 percent. The gauge surged 1.1 percent Monday.
China devalued the yuan by the most in two decades in an effort to support its exporters. The central bank cut its daily reference rate by 1.9 percent. China is Canada’s second-largest trading partner after the U.S.
The Bloomberg Commodity Index, which tracks a basket of prices for raw materials including gold, natural gas and crude, sank 1.6 percent a day after rising the most since February. The index had fallen to a 13-year low last week, dragging down companies that comprise about one-third of Canada’s stock market. Prices have tumbled 13 percent this year.
Oil sank as OPEC raised output by 100,700 barrels a day to 31.5 million last month, the most since 2012, due to a recovery in Iranian production, exacerbating a supply glut. Oil has dropped more than 25 percent since this year’s peak in June.
First Quantum Minerals Ltd. sank 7.8 percent and Teck Resources Ltd. tumbled 6.9 percent as all six main metals on the London Metal Exchange retreated, led by aluminum and copper at six-year lows.
B2Gold Corp. jumped 10 percent and Eldorado Gold Corp. increased 5.5 percent. Gold, which is often bought as an alternative to currencies, rose 0.3 percent in New York.
Aecon Group Inc. jumped 9.3 percent, the most in almost four years, after posting a surprise profit in the second quarter and revenue that topped analysts’ estimates.
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