TSX Turns Lower Midday

Barrick Gold to buy Randgold Resources in $18.3 billion deal

Canada's main stock index was trading lower Monday afternoon despite a jump in energy stocks as a surge in crude oil prices hit a four-year high.

The S&P/TSX Composite Index was off 12.51 points at 16,211.62.

Canada’s Barrick Gold (ABX) has agreed to buy Randgold Resources Ltd (RRS.L) in a $18.3 billion share deal to create the world’s largest gold company by value and output in an industry under investor pressure to put capital to good use. The new Barrick company, which will be listed in New York and Toronto, will own five of the world’s 10 lowest cost gold mines and will be valued at $24 billion including debt.

Canadian food retailer Empire Co Ltd. said on Monday it would acquire privately held grocer Farm Boy Inc for an enterprise value of C$800 million ($618 million) to increase its presence in Ontario. Ottawa-based Farm Boy, which specializes in “farm-to-table” wholesale, will be acquired from Berkshire Partners, following which it will be set up as a separate company within Empire’s structure.

On the economic front - Wholesale sales rose 1.5% to $63.9 billion in July, more than offsetting the 0.9% decline in June. Sales were up in four of seven subsectors, representing approximately 66% of total wholesale sales.

The Canadian dollar traded lower at 77.34 cents U.S. compared with an average of 77.42 cents U.S. on Friday.

ON BAYSTREET

The TSX Venture Exchange inched off 3.87 points to 716.04.

Four of subgroups were trading in the green Monday midday, with energy better by 1.89%, gold ahead 1.61%, and health-care up 1.35%.

On the downside -- Metal stocks were off 1.47%, consumer discretionary issues shed 1.23% and telecom stocks were down 1.01%.

The December gold contract was up $7.30 (U.S.) at $1,208.60 (U.S.) an ounce and the December copper contract was down 0.70 of a cent at $2.85 (U.S.) a pound.

ON WALLSTREET

U.S. stocks fell in midday trading on Monday, with major technology stocks among the biggest drags as the latest round of tariffs on U.S. and Chinese goods took effect.

The Dow Jones Industrial Average fell 156 points, or 0.6%, to 26,589. The blue-chip average closed at a record on Friday. The S&P 500 lost 12 points to 2,918, a decline of 0.4%. The Nasdaq Composite Index shed 35 points to 7,952, a drop of 0.4%. The Nasdaq recovered more than half of its initial drop.

Technology stocks were among the biggest decliners, falling 0.9%. The consumer-discretionary sector—which includes such names as Amazon and Netflix—fell 1.1%.

Among the technology stocks weighing on the broader market, Microsoft Corp. fell 1.5% while Google-parent Alphabet Inc. lost 1%. Separately, Amazon.com fell 1.3%.

Sirius XM Holdings Inc. agreed to buy Pandora in a stock deal valued at $3.5 billion. Shares of Pandora jumped 8.8% while Sirius fell 2.7%.

Bucking the trend was the energy sector, which surged 1.6% on the back of higher oil prices. The group was on track for its best session since June.

On the economic data front, the Chicago Fed’s national activity index came in at 0.18 in August, unchanged with the previous month.

Crude-oil prices gained 1.7%, with Brent-crude futures up 2.2%, trading near their highest level in more than three years. The rise came as major energy producers declined to commit to increasing crude output to address expected supply disruptions at a closely watched producer meeting.

The November crude contract was up $1.39 (U.S.) at $72.17 (U.S.) per barrel and the November natural gas contract was up 5.5 cents at $3.03 (U.S.) per mmBTU.

The benchmark 10-year Treasury note yield traded at 3.072 percent on Monday.