Oct.31 (Bloomberg) -- Canadian stocks fell, paring a monthly gain, asenergy and raw material producers declined with commodity prices afterJapan moved to weaken its currency against the U.S. dollar.
Barrick Gold Corp., the world's largest producerof the metal, lost 2.6 percent as the U.S. Dollar Index surged the mostsince December 2008. Suncor Energy Inc., Canada's largest oil and gasproducer, dropped 4 percent. First Quantum Minerals Ltd., the country'ssecond-biggest publicly traded copper producer, slid 6.1 percent afterthe industrial metal declined as investors awaited details on Europeanleaders' revamped strategy for curbing the region's debt crisis.
The Standard & Poor's/TSX Composite Index decreased 267.45 points, or 2.1 percent, to 12,252.06.
“On the last day of the month anything canhappen,” Brendan Caldwell, chief executive officer of CaldwellInvestment Management Ltd. in Toronto, said in a telephone interview.The firm manages C$1 billion ($963 million). “The strength in the U.S.dollar has caused gold to come off. So much of the Canadian economy isstill raw materials and not finished products that a move here or theremakes a difference.”
The S&P/TSX rallied 5.4 percent this monthfor its biggest increase since May 2009 after falling each of theprevious seven months. Oil and raw materials shares led gains asinvestors speculated European leaders' move to boost the region's rescuefund will prevent the debt crisis from weakening banks and the broadereconomy.
Japan sold yen for the third time this year andpledged more sales after the currency's gain to a post-World War II highagainst the dollar threatened a recovery from the March earthquake andnuclear disaster.
The S&P/TSX Materials Index retreated, ending a six-day streak of advances.
Gold Miners
Gold producers fell after the metal dropped asthe U.S. dollar surged, reducing demand for the precious metal as analternative investment. Barrick lost 2.6 percent to C$49.21. GoldcorpInc., the world's second-largest company in the industry by marketvalue, slipped 2.3 percent to C$48.50. Semafo Inc., which mines in WestAfrica, decreased 8.1 percent to C$7.65.
Energy shares retreated the most in four weeks asoil dropped. Suncor declined 4 percent to C$31.75. Cenovus Energy Inc.,the country's fifth-biggest energy company by revenue, declined 5.2percent to C$34.14. Precision Drilling Corp., Canada's largest contractdrilling company, tumbled 7.4 percent to C$11.56.
Copper producers fell as the metal dropped aftersurging the most since at least 1988 last week. First Quantum lost 6.1percent to C$20.91. Teck Resources Ltd., Canada's largest base- metalsand coal producer, decreased 3.7 percent to C$39.96. Lundin MiningCorp., which operates in Europe, retreated 4.6 percent to C$3.91.
Potash Corp.
Potash Corp. of Saskatchewan Inc., the world'slargest fertilizer producer by market value, sank 4.9 percent to C$47.18as corn and wheat fell. Agricultural commodities declined as a strongerdollar eroded prospects for U.S. exports.
The S&P/TSX Industrials Index fell 2.6percent, trimming the biggest monthly advance since November 2001. Theindex lost 19 percent in the third quarter, its worst slide since 2002.
Canadian Pacific Railway Ltd., the country'ssecond-biggest railroad, decreased 7.1 percent, the most since December2008, to C$61.61 after jumping 7.9 percent Oct. 28, when WilliamAckman's Pershing Square Capital Management LP bought a 12 percent stakein the company.
Cameron Doerksen, an analyst at National Bank ofCanada, cut his rating on the shares to “underperform” from “sectorperform,” while Turan Quettawala, an analyst at Bank of Nova Scotia,reduced his rating to “sector perform” from “sector outperform.” In anote to clients, Doerksen said Pershing Square's acquisition may lead tomanagement changes that are unlikely to affect earnings in the nearterm.
Monthly Surge
Canadian National Railway Co., the country'slargest railroad, lost 2.3 percent to C$78.08, trimming its biggestmonthly gain since October 2006. Bombardier Inc., the maker of trainsand airplanes, decreased 6.6 percent to C$4.12 after rallying 8.1percent Oct. 28.
Grande Cache Coal Corp., which mines in Alberta,surged a record 68 percent to C$9.87 after China's Winsway Coking CoalHoldings Ltd. and Japan's Marubeni Corp. agreed to buy the Calgary-basedmetallurgical coal producer for C$10 a share in cash.
Cline Mining Corp., which is developing coalmines in Canada and the U.S., rallied 19 percent, the most this year, toC$2.11. The company may be the next in the industry to be acquired,Marc Johnson, an analyst at M Partners Inc., said in a note to clients.
Pacific Northern
Natural gas-pipeline company Pacific Northern GasLtd. rose a record 20 percent to C$36.67 after agreeing to be bought byAltaGas Ltd., a natural gas extraction and transmission company, forC$36.75 a share in cash. AltaGas fell 1.7 percent to C$29.41.
Technology-patent owner Wi-LAN Inc. gained 8percent to C$7.42 after saying it doesn't intend to raise its C$532million bid for Mosaid Technologies Inc. Mosaid agreed Oct. 27 to bebought by Sterling Partners for C$590 million.
--Editors: Joanna Ossinger, Stephen Kleege
Matt Walcoff in Toronto at mwalcoff1@bloomberg.net