Canada’s main stock index ended sharply lower on Monday, hurt by sharp falls in energy companies, gold miners and other resource stocks, while the continued fall in Valeant Pharmaceutical International Inc shares also weighed.
The S&P/TSX composite index erased 162.76 points, or 1.2%, to close Monday at 13,790.90
The Canadian dollar was unchanged at 75.96 cents U.S.
Commodities producers retreated, led by declines among oil stocks. Crescent Point Energy Corp. dropped 1.8% to $17.88 and Encana Corp. retreated 6.9% to $9.86.
Drugmaker Valeant laid out a detailed defence on Monday of its relationship with a little-known specialty pharmacy, but its arguments failed to calm all investors’ concerns.
Valeant’s shares fell 4.8%, or $7.35, to $145.34 in choppy trading in Toronto after tumbling as much as 14% before normal market hours. They had plunged 35 per cent last week following a critical report by short-seller Citron Research, run by Andrew Left.
Laval, Que.-based Valeant said it has asked U.S. securities regulators to investigate Citron’s "completely untrue" allegation that the company used its ties with a specialty pharmacy to inflate revenue, and said it would conduct a review of its pharmacy network.
Smaller peer Concordia Healthcare Corp. fell 4.9%, or $2.16, to $41.55. Concordia and Valeant were the two best-performing stocks in the S&P/TSX through the first half of the year, fuelled by aggressive growth-by-acquisition strategies.
ON BAYSTREET
The TSX Venture Exchange faded 4.34 points to 546.87
All but one of the 13 TSX subgroups were lower, as gold stocks dove 3%, energy slid 2.7%, and the metals and mining group fell 2.2%.
Telecoms proved the lone gainer, squeezing up 0.1%.
ON WALLSTREET
U.S. stocks closed narrowly mixed Monday, holding most of last week's gains, as investors readied for another week of earnings and central bank announcements.
The Dow Jones industrial average remained negative 23.65 points to 17,623.05, with Apple the greatest laggard and Visa leading advancers.
The S&P 500 fell 4.37 points to 2,070.78, with energy leading eight sectors lower and consumer discretionary and health care the only gainers.
The NASDAQ index moved higher 1.04 points to 5,032.91.
Apple fell more than 3% ahead of its earnings report due after the close Tuesday. Chevron declined more than 2.5% to join Apple as the greatest weights on the Dow
Shares of Alphabet, Google's holding company, closed about 1.5% higher. Microsoft rallied 2.6% and Facebook and Amazon ended up about 1.6%
On Monday, supplier Dialog Semiconductor plunged 20% in London trade after reporting preliminary earnings and guidance that missed expectations, according to Street Account.
In corporate news, NYSE owner Intercontinental Exchange announced it will acquire Interactive Data Corporation for about $5.2 billion U.S.
Valeant Pharmaceuticals said it has formed a committee to review allegations against the company. The firm's CEO also asked the SEC to investigate Citron Research.
Xerox reported earnings that topped estimates but revenue missed. The office solutions company's results were hurt by lower printer sales and a strong dollar, and said it would conduct a review of its business operations.
Firms expected to report after the close include Avalon Bay, Broadcom, Edwards Lifesciences, Everest Re, Hartford Fincl., and Cheesecake Factory.
Key earnings for the week include Exxon Mobil on Friday.
In U.S. economic news, September new home sales fell 11.5% to near a one-year low after two straight months of gains.
The Federal Open Market Committee kicks off its two-day meeting Tuesday and is scheduled to release its statement Wednesday afternoon.
Prices for 10-year U.S. Treasuries gained ground, thus lowering yields to 2.06% from Friday’s 2.09%. Treasury prices and yields move in opposite directions.
Oil prices were down 67 cents a barrel to $43.93 U.S.
Gold prices lost 70 cents to $1,163.75 U.S. an ounce.
