Canadian shares fell in midday trading as auto-parts makers declined as investors weighed weak manufacturing data from China, the nation’s second-largest trading partner.
The benchmark Standard & Poor’s/TSX Composite Index (TSE:OSPTX) fell 0.6% to 13,411.81 at 12:22 p.m. in Toronto. Three shares declined for every issue that advanced as eight out of ten share groups were in negative territory.
Magna International (TSE:MG) fell 2.1% to C$61.05. CIBC downgraded North America’s largest auto-parts supplier to “sector perform” from “sector outperform” and cut its target price to $52 from $62.50 in the wake of the Volkswagen emissions scandal.
A preliminary China manufacturing gauge fell to a six-year low, disappointing market expectations. The Purchasing Managers’ Index from Caixin Media and Markit Economics dropped to 47.0 in September, from the final reading of 47.3 in the previous month.
The energy sector, the main index's second most heavily weighted group, was the biggest laggard with a 1.4% drop as oil futures saw volatile trading.
Suncor Energy (TSE:SU), Canada's largest oil sands producer, slipped 0.7% to C$34.32. Canadian Natural Resources Limited (TSE:CNQ), Canada’s second-largest energy producer, fell 1.4% to C$26.27.
November West Texas Intermediate crude traded at $45.61 a barrel, down 1.6% on the New York Mercantile Exchange after earlier tapping a high above $47.
The materials sub-index, which includes mining shares, fell 1% even as gold firmed. Goldcorp (TSE:G), Canada’s largest gold miner by market value, was flat at C$16.85. Barrick Gold (TSE:ABX), Canada’s second-largest gold miner, slipped 0.4% at C$8.06.
Gold rose 0.6 percent to $1,131.16 an ounce.
Financials, the index's most heavily weighted sector, sagged 1%. Royal Bank of Canada (TSE:RY), which has the heaviest weighting in the index, slid 0.8% to C$71.30. Toronto-Dominion Bank (TSE:TD), the second-largest bank by market value, sank 1.2% to C$50.90.
WestJet Airlines (TSE:WJA) skidded 1.4% to C$23.57, reversing an earlier gain. Canada's second-biggest carrier said it has named Harry Taylor as chief financial officer.
In economic news, Canada’s retail sales rose for a third month in July as families spent more on cars and clothes, supporting the view economic growth is on pace for a third-quarter rebound.