Markets

Canada Stocks Losing to U.S. by Most Since 1998 as Commodity Shares Retreat: report

Canadian stocks trailed U.S. equities this year by the most since 1998 as the European debt crisis and slowing growth in developing markets drove down commodity shares, Bloomberg reported.

The Standard & Poor's/TSX Composite Index fell 12% in 2011 through yesterday, while the S&P 500 rose 0.4%, the first year Canada has lagged behind the U.S. since 2003 and the widest gap since crude oil slid below $11 a barrel 13 years ago. Energy and mining stocks, almost half of Canada's market by value, fell as Suncor Energy Inc. (SU.TO), the country's largest oil and gas producer, lost 24% and Teck Resources Ltd. (TCK-B.TO), its biggest base-metals company, plunged 43%.

Canada's oil, gas and metal shares slumped after valuations soared in 2009-2010, as oil prices doubled and copper tripled after the world pulled out of a recession, spurring a 50% surge in the S&P/TSX. This year, the level of the S&P/TSX Energy Index relative to profits fell as much as 43%, after hitting the highest multiple since at least 2002 in March.

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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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