Stocks in the nation’s biggest market dropped on Monday, joining a rout in commodities prices as iron ore slumped below $40 U.S. a metric ton and oil extended a selloff after OPEC on Friday effectively abandoned its production target.
The S&P/TSX composite index moved earthward 328.07 points, or 2.5%, to close at 13,030.70. The index has declined for two consecutive weeks and has lost more than 10% so far this year.
The Canadian dollar collapsed 0.85 cents to 74 cents U.S.
Hudbay Mineral fell 11.4% to $5.43, while First Quantum Minerals slipped 11.1% to $4.41, and Teck Resources Ltd. sank 9.4% to $4.99, as copper futures and gold fell by more than 1% in New York.
Penn West Petroleum Ltd. fell 18.5% to $1.06, its biggest drop in more than three months as energy stocks retreated. Paramount Resources sank 22.6%, to $5.89, and Baytex Energy fell at least 16.5% to $4.39. Energy companies have dropped 28% this year.
As crude declined, Canadian airlines jumped on the cheaper oil prices. Air Canada gained 2.6% to $10.59, while WestJet Airlines gained 0.9% to $20.51. Macquarie Research also upgraded WestJet to the equivalent of buy from neutral.
Also among the S&P/TSX’s best performers, ProMetic Life Sciences Inc. rose 6.6% to $3.22. The bio-pharmaceutical company said its trial for a coagulation disorder drug met safety metrics, while patients showed an immediate therapeutic response.
ON BAYSTREET
The TSX Venture Exchange slumped 8.62 points, or 1.7%, to 508.51.
All but two of the 13 TSX subgroups were lower on the day, as metals and mining dropped 7.6%, energy weakened 5.9%, and gold slid 3.5%.
The two gaining subgroups were health-care, up 1.2%, and consumer staples, up 0.5%.
ON WALLSTREET
U.S. stocks closed lower Monday, weighed by a sharp decline in energy as oil plunged to a near-seven-year low.
The Dow Jones industrial average faltered 117.12 points – off its lows of the day -- to close Monday at 17,730.51, after a gain of more than 360 points on Friday. Chevron and Exxon Mobil both closed down more than 2.5%. Goldman Sachs also weighed.
The S&P 500 shed 14.61 points to 2,077.08. Energy temporarily fell more than 4.5% as the greatest laggard in the S&P 500.
The NASDAQ index swooned 40.46 points to 5,101.81. Declines in biotech stocks and Apple also pressured the major averages.
In individual stock news, Chipotle Mexican Grill briefly fell more than 4.5% in intraday trade after the company on Friday issued a fourth-quarter warning and said its sales have been hammered due to an E. coli outbreak.
Keurig Green Mountain held more than 72% higher to trade just below $90.00 U.S. a share after the firm said it has agreed to be taken private by an investor group led by JAB Holding for $92.00 U.S. a share in cash. Trade volume was more than quadruple its 30-day average.
General Electric traded more than 0.5% lower after it deal to sell its appliance business to Swedish appliance maker Electrolux fell through, Reuters reported. The deal, which had been announced last year, would have been Electrolux's largest acquisition ever.
The decline in oil prices came after the Organization of the Petroleum Exporting Countries failed on Friday to agree on a production curb to stem sliding prices and a stronger dollar made holding crude positions more expensive.
Prices for the 10-year Treasury gained, lowering yields to 2.24% from Friday’s 2.28%. Treasury prices and yields move in opposite directions.
Oil prices ditched $2.22 a barrel to $37.75 U.S.
Gold prices moved lower $14.95 to $1,071.49 U.S. an ounce.
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