Canadian Stocks Drop Amid Global Equities Rout as Tech Retreatsby
Tech stocks fall to lowest since August in valuation selloff
Consumer stocks tumble to level last seen in October 2014
Canadian stocks joined a selloff in global equities, as persistent concerns about global economic growth prompted declines in shares with some of the highest valuations.
The Standard & Poor’s/TSX Composite Index slumped 1.8 percent to 12,535.40 at 4 p.m. in Toronto, as eight of the 10 main industries tumbled. The decline pushed the index’s loss for the year to 3.7 percent, giving it the second-best performance among developed-nation markets tracked by Bloomberg as gold miners have rallied with the price of bullion on haven demand.
A rout in technology stocks deepened Monday as Canadian companies in the industry fell 2.6 percent to the lowest since August. Sierra Wireless Inc. retreated 6.2 percent to the lowest since September 2013. BlackBerry Ltd. dropped 5 percent, as the company’s job cut plan continued to raise concerns. American tech shares plunged, with the Nasdaq Composite Index falling to the lowest in 15 months, as investors sold some stocks with the highest valuations.
The Canadian benchmark index trades for 19.2 times the reported earnings of its members, 14 percent higher than the S&P 500. While the Nasdaq index has a price-to-earnings ratio higher than 25, Canada’s technology index trades at 27.4 times.
The nation’s raw-materials producers were the biggest gainers Monday, as an index of gold miners surged 4.4 percent after the price of bullion futures rallied toward $1,200 an ounce for the first time since June. Yamana Gold Inc., capped its longest rally since December 2008 with a seventh straight gain, jumped 11 percent. OceanaGold Corp. advanced 11 percent to the highest since December 2010.