Canada Stocks Retreat Amid Trade, Jobs Data Before U.S. Election

(Bloomberg) -- Canadian stocks extended losses for a fourth day, closing at their lowest level since September as trade data overshadowed a third month of job gains.

The S&P/TSX Composite Index fell 0.5 percent to 14,509.25 at 4 p.m. in Toronto, with its longest decline since August. Raw materials producers led the decline, falling 1 percent. Energy companies dropped for the sixth consecutive day, their longest losing streak since May, retreating after oil capped its biggest weekly decline since January.

Stronger-than-forecast jobs data was countered by a trade deficit that widened to a record C$4.1 billion ($3.1 billion) in September as export volumes fell 0.8 percent from the previous month. However, the spike in the trade deficit was largely on the back of a one-time purchase related to an offshore oil project, described by Statistics Canada as “exceptionally large.” Excluding that impact, the trade gap narrowed, the agency said.

Financial stocks declined for the third time in four days amid U.S. election angst. The group fell to its lowest level since mid-October, as Toronto-Dominion Bank and Bank of Nova Scotia slumped to two-week lows.

Raw-materials producers fell as gold miners retreated, even as the precious metal held near a one-month high. Investors weighed the need for a haven before next week's U.S. presidential election against expectations of higher interest rates. Detour Gold Corp. slumped to a seven-month low in an “overdone” selloff, according to Cormark Securities analyst Richard Gray. Kinross Gold Corp. lost 2.3 percent.

Energy shares declined 0.5 percent to their lowest level since September, after oil capped its biggest weekly loss in almost 10 months. Crude slumped as hopes fade that OPEC will be able to implement a promised deal to cut production and ease global oversupplies. Suncor Energy Inc. fell 1 percent to a two-week low, and Canadian Natural Resources Ltd. fell to its lowest level since September.

Canadian stocks are now 13 percent more expensive than their peers in the S&P 500 Index. The S&P/TSX trades at 22.1 times earnings, compared with 19.5 for the S&P 500 Index. The S&P/TSX is the top performer this year among developed equity markets tracked by Bloomberg.

To contact the reporter on this story: John Hyland in New York at jhyland22@bloomberg.net. To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Eric J. Weiner