Canadian stocks fell in the first trading session of May, after capping a third monthly gain, as energy producers declined with oil and Bank of Nova Scotia slipped after reporting a C$275 million restructuring charge.
The benchmark S&P/TSX Composite Index fell 0.5 percent to 13,884.28 at 10:41 a.m. in Toronto. The gauge increased 3.4 percent in April, matching the longest monthly winning streak since August 2014. The S&P/TSX is one of the best-performing developed markets in the world this year as it rebounds from last year’s worst annual decline since 2008.
Suncor Energy Inc. and Cenovus Energy Inc. fell at least 2 percent to lead energy producers lower as six of 10 industries in the S&P/TSX retreated on trading volume 15 percent higher than the 30-day average at this time of the day.
Crude futures sank 1.5 percent in New York, extending a slide from Friday. Exports from Iraq approached a record in April, shipping 3.36 million barrels a day in the month to add to a worldwide supply glut, according to an oil ministry spokesman. The figures don’t include sales by the Kurdistan Regional Government.
The resource-dominant S&P/TSX remains closely linked to moves in commodities prices, with an 17 percent rally in the benchmark equity gauge from a Jan. 20 low aligning with a rebound in crude from the lowest levels since 2003. Raw-materials and energy producers are the two top-performing industries in Canada so far this year, up more than 12 percent.
The Canadian benchmark now trades at 21.5 times earnings, about 12 percent higher than the 19.2 times earnings valuation of the Standard & Poor’s 500 Index, according to data compiled by Bloomberg.
Scotiabank lost 0.8 percent after reporting it will take a charge of 22 cents a share in its fiscal second quarter, to cover the cost of job cuts and other productivity enhancements as it shifts toward digital banking. The bank is scheduled to report results May 31.
Manitoba Telecom Services Inc. climbed a record 16 percent to the highest since 2008, after agreeing to sell itself to BCE Inc. in a C$3.1 billion cash and stock deal. Manitoba Telecom traded at a lower value than the C$40 a share acquisition price. As a follow-on to the deal, BCE will also transfer one-third of Manitoba Telecom’s wireless subscribers to competitor Telus Corp. BCE rose 0.8 percent while Telus gained 0.5 percent.
Valeant Pharmaceuticals International Inc. sank 9.7 percent, the most in six weeks, for a third day of losses in the last four. Warren Buffett criticized Valeant at Berkshire Hathaway Inc.’s annual meeting, calling the drugmaker’s business model “enormously flawed.”