Canada Stocks Halt Rally as Oil Slumps on Saudi Skepticism

  • Saudi Arabia doesn’t expect supply decision at Algiers talks
  • Financials slide with inflation slowest in 2 years in August

TSX Movers: Teck, New Flyer, Paramount Resources

Canadian stocks halted a four-day rally as energy producers tumbled with crude, while inflation data that boosted the likelihood of added stimulus sent financial shares lower and an unexpected drop in retail sales weighed on consumer shares.

The S&P/TSX Composite Index fell 0.7 percent to 14,697.93 at 4 p.m. in Toronto, paring the best weekly advance since April to 1.7 percent. The benchmark for Canadian equity has surged 4.5 percent in the third quarter, pushing its gain this year to 13 percent. 

Nine of the 11 sectors declined Friday, with raw-materials and energy producers losing more than 1 percent. Oil and gas companies retreated as New York crude slumped as much as 4.1 percent to trade at around $44 a barrel after Saudi Arabia was said to dismiss the prospects for an output agreement in talks in Algiers next week, according to an OPEC delegate familiar with the nation’s oil policies.

Financial-service firms fell 0.5 percent Friday. Only six of the 26 members in the group advanced. Combined the firms make up about one-third of the S&P/TSX. Bank of Nova Scotia fell 0.9 percent after closing at a record.

Canada’s core inflation rate was the slowest in two years in August, with the pace of consumer prices and overall inflation decelerating. The data spurred bets the economy may need added monetary stimulus. That hit financial shares that would see profits crimped by lower interest rates.

Shares of consumer staples stocks fell after data showed retail sales unexpectedly fell in July. Maple Leaf Foods Inc. slumped 1.8 percent and Loblaw Cos. slid 1 percent to pace declines.

Raw-materials producers slipped 1.4 percent. Barrick Gold Corp. and Goldcorp Inc. dropped more than 1.2 percent. Silver Wheaton Corp. slumped 2.3 percent and First Quantum Minerals Ltd. fell 1.2 percent.

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