Canada Stocks Lowest in Two Years as Valeant, Commodities Plungeby
Mining companies tumble to 10-year low as China growth slows
Equities on pace for worst three months in four years
Canada stocks tumbled to a two-year low as Valeant Pharmaceuticals International Inc. plummeted and commodities producers fell to a decade low after data showed Chinese industrial profits tumbled.
Equities lost 2.8 percent, on pace for the worst month in three years. Raw-materials producers joined a global slide as the Bloomberg World Mining Index plunged to the lowest level since November 2008. Glencore Plc plunged 29 percent in London to an all-time low.
Valeant, the third-largest company in Canada’s benchmark equity gauge by market capitalization, sank 16 percent for the biggest decline in four years after Democrats in the U.S. House asked to subpoena the company for documents relating to drug price increases. Smaller drugmaker Concordia Healthcare Corp. plunged 25 percent.
The Standard & Poor’s/TSX Composite Index fell 373.99 points to 13,004.58 at 4 p.m. in Toronto, the lowest close since October 2013. The gauge has declined 6.2 percent in September, the worst drop since 2012, and headed for its worst quarter in four years.
Chinese industrial companies reported profits fell 8.8 percent in August from a year earlier, the most since the government began releasing monthly data in 2011. The biggest drops were concentrated in producers of coal, oil and metals, according to a report from Beijing. The Bloomberg Commodity Index, which tracks a basket of prices from live cattle to gold, has plunged 16 percent this year.
Global markets retreated, as the MSCI All-Country World Index slumped to a two-year low. The S&P 500 tumbled 2.6 percent in New York while the Stoxx Europe 600 fell 2.2 percent.
First Quantum Minerals Ltd. sank 15 percent and Teck Resources Ltd. tumbled 8.7 percent as raw-materials companies plunged 4.6 percent as a group, for the lowest close since July 2005. The gauge has slumped 11 percent in September, headed for a fifth straight monthly decline. Copper fell 1.4 percent to a monthly low in New York.
Gold producers retreated 4.7 percent for a second day of losses. Goldcorp Inc. lost 6.7 percent and Barrick Gold Corp. dropped 4.1 percent as all 21 members of the S&P/TSX Gold Index declined. Gold futures for December delivery fell 1.2 percent.
TransCanada Corp. dropped 5.9 percent and Crescent Point Energy Corp. lost 3.9 percent as energy shares tumbled 3 percent. Royal Bank of Canada retreated 1.2 percent to lead financial-services companies lower.
Canadian equities are among the worst-performing markets in the developed world this year with an 11 percent slide, led by declines among raw-materials and energy producers of at least 25 percent. Commodity shares are retreating amid plunging oil prices and uncertainty about global economic growth, especially in China. China is Canada’s second-largest trading partner after the U.S.