Markets

Canada Stocks Lose Circa 85 Pts; Focus On Scotiabank and CI Financial, Air Canada and Bombardier

Canada Stocks dropped the most in a month but did recover ground over the late afternoon before closing down 85 points as the resources heavy index felt the weight of drooping commodity prices. BNN TV said late Thursday that four stocks were down for every one.

Stories of the day here involved Bank of Nova Scotia (BNS.TO, BNS) and CI Financial (CIX.TO) on one hand, and Air Canada (AC-B.TO) and Bombardier (BBD-B.TO) on the other.

Most sectors were down, led by Metals and Mining, but Telecom bucked the trend.

Of commodities, gold closed around 1% lower on technical selling as prices fell below US$1,300 an ounce. Also, gold's safe haven appeal was lessened as jobless claims and consumer prices data pointed to an improving U.S. economy. Crude fell 1% in New York.

Meanwhile, palladium and platinum retreated after a three day rally. And Bloomberg reported that Nickel slumped the most since 2011 in London as investors judged a rally that lifted the metal's price as much as 56% this year to be exaggerated.

Bank of Nova Scotia hit fresh record highs after saying Wednesday might it will consider selling part or all of its $3.8 billion or 37% stake in CI Financial, one of Canada's biggest money managers, and use the proceeds to invest elsewhere within the bank. The move comes as new financial regulations make it more expensive for banks to hold minority stakes in other financials.

CIX, which was trading shy of record highs but lost 3% today, in a statement said it was considering the implications of the announcement and the impact it may have on CI's other shareholders. As part of this, CI intends to review its capital structure and dividend policy to ensure that it has the appropriate resources available to respond to any monetization plan Scotiabank seeks to implement.

Air Canada lost near 4% after it reported a Q1 2014 net loss of $341 million, or $1.20 per diluted share, compared to a net loss of $260 million, or $0.95 per diluted share, in the same period last year. On an adjusted basis, net loss was 132 million, or $0.46 per diluted share, compared to a net loss of $143 million, or $0.52 per diluted share, last year. The Capital IQ consensus is for adjusted loss of $0.45 per diluted share. The carrier also decided to not replace its 25 Embraer jets with Bombardier's CSeries jets to avoid additional capital expenditures and debt. This sent Bombardier down 7.14%.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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