Canada Stocks Fall From Six-Month High on Banks, Consumer Shares

  • ECB President Draghi defends stimulus as rates left unchanged
  • Concordia surges most in a year on possible Blackstone deal

Canadian Stocks End Three-Day Winning Streak

Canadian stocks fell, halting a three-day gain, as global equities halted an advance amid growing concern that central-bank stimulus is failing to achieve results. Consumer staples producers and phone companies led declines, while Concordia Healthcare Corp. boosted health-care shares.

The benchmark Standard & Poor’s/TSX Composite Index equity gauge lost 0.2 percent to 13,881.20 at 4 p.m. in Toronto, after closing yesterday at a six-month high. The benchmark gauge is one of the best-performing developed markets in the world this year with a 6.7 percent gain. Trading of shares was 11 percent higher than the 30-day average.

The European Central Bank left its interest rates unchanged at record lows while maintaining asset purchases of 80 billion euros a month. ECB President Mario Draghi asked for more time to allow the unprecedented stimulus measures to work, while calling on governments to do more.

Royal Bank of Canada, the nation’s largest lender, retreated 1.5 percent to lead financial services stocks lower. Alimentation Couche-Tard Inc. dropped 3.8 percent as consumer staples stocks slid.

Crude in New York fell 2.3 percent, retreating from the highest level in almost five months. Crude inventories climbed to 538.6 million barrels last week, the highest level since 1930, U.S. data showed. OPEC members and other producers plan to meet in Russia, possibly in May, to again discuss a potential production cap after talks Sunday in Doha failed to produce a deal.

Meanwhile, Kinross Gold Corp. and Barrick Gold Corp. posted among the biggest advances in raw-materials producers in the S&P/TSX, rallying more than 3.6 percent. Concordia jumped 25 percent, the most since March 2015, to push health-care stocks higher. Blackstone Group LP is considering a takeover of Concordia, according to people familiar with the matter.

The resource-dominant S&P/TSX remains closely linked to moves in commodities prices, as a rebound in producers has fueled a 17 percent recovery for the S&P/TSX from a low on Jan. 20. The Canadian benchmark now trades at 22.1 times earnings, about 15 percent higher than the 19.1 times earnings valuation of the Standard & Poor’s 500 Index, according to data compiled by Bloomberg.

Bombardier Inc. dropped 1.2 percent after TD Securities equity analyst Timothy James lowered his rating for the stock. The struggling aircraft manufacturer’s negotiations with the Canadian government over aid include seeking assurances on jobs, research spending and its head office, according to the cabinet minister leading the review. 

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