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Canadian stocks fell, heading for the first monthly decline since May, as the nation’s economic growth slowed more than estimated and U.S. budget talks continued in Washington.
Talisman Energy (TLM) Inc. slipped 3.5 percent after BMO Capital Markets lowered its rating on the stock. First Quantum Minerals Ltd. (FM), which had its C$4.86 billion ($4.9 billion) offer for Inmet Mining Corp. (IMN) rejected, dropped 1.1 percent. Nexen Inc. (NXY), which is awaiting approval of its sale to China’s Cnooc Ltd., rallied 3.7 percent to snap nine days of losses after Canadian Prime Minister Stephen Harper said the government will soon make decisions on foreign-investment guidelines.
The Standard & Poor’s/TSX Composite Index (SPTSX) slipped 0.2 percent to 12,178.61 at 2:12 p.m. in Toronto. The benchmark Canadian equity gauge is down 0.3 percent this week and is poised for a loss of 2 percent for the month. Trading volume was 7 percent lower than the 30-day average at this time of the day.
“We have been expecting a slower economy, and the U.S. remains a huge influence on us,” said John Kinsey, a fund manager with Caldwell Securities Ltd. in Toronto. His firm manages about C$1 billion.
Canada’s economic growth slowed to a 0.6 percent annualized pace in the third quarter as consumer spending gains were blunted by the fastest export decline since the end of the last recession and falling business investment. The gain in gross domestic product for July to September was the slowest in more than a year and short of analysts’ estimates, according to a survey by Bloomberg.
In the U.S., congressional Republicans dug in to fight President Barack Obama’s plan to skirt the fiscal cliff, rejecting his tax-and-spending proposal as the president heads out today to sell it to the American public.
Commodity companies fell the most among the 10 industry groups in the S&P/TSX. Talisman Energy dropped 3.5 percent to C$11.15 after Randy Ollenberger, an analyst with BMO Capital Markets, cut his rating on the oil and natural gas producer to market perform from outperform.
First Quantum slipped 1.1 percent to C$20.15. The Vancouver-based copper mining company said yesterday it was “surprised and disappointed” at Inmet’s rejection. The company had offered C$70 a share in cash and stock, after earlier proposing a deal at C$62.50 in October. Inmet rose 3.2 percent to C$67.62.
Richmont Mines Inc. (RIC) slumped 24 percent to C$2.89. The gold producer said it closed a mine and suspended exploration at another near Rouyn-Noranda, Quebec. The company cut its output forecast for next year.
Nexen added 3.7 percent to C$24.11. Canadian regulators are reviewing the sale of Calgary-based Nexen and an appeal of Petroliam Nasional Bhd.’s rejected C$5.2 billion ($5.24 billion) bid for Progress Energy Resources Corp.
Trilogy Energy Corp. (TET) rose 1.8 percent to C$28.26 and Bonterra Energy Corp. (BNE) added 1.4 percent to C$43.55. Crude headed for its first monthly gain since August.
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