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CANADIAN EQUITIES: What moved the market the week of July 23rdTuesday, July 31, 2007
The S&P/TSX composite fell 5.72% last week, losing a total of 834.34 points, to close at 13748.53. The week's sell off started on Tuesday with a 400 point decline that was mainly driven by falling commodity prices. On Friday, credit concerns and US sub-prime market fears continued to drive the market downwards. Over the week, market decliners led advancers 25 to 1. Sector declines were led by Industrials (-7.5%), Materials (-6.87%), Energy (-6.54%) and Financials (-5.14%). Market laggards of the week were from the financial sector, with Royal Bank (RY), losing 6.73%. Other market laggards included, Toronto Dominion Bank (TD) (-5.43%), Bank of Nova Scotia (BNS) (-4.93%), and Manulife Financial (MFC) (-3.99%). The energy sector was also impacted by a fall in crude oil prices early in the week, with notable laggards including Suncor (SU), Canadian Natural Resources (CNQ) and Petro Canada (PCA), posting declines of (-5.59%), (6.02%) and (-8.31%), respectively. Crude oil prices recovered on Friday to US $77.02 a barrel after a government report demonstrated that the US economy had grown more than anticipated over the second quarter. The fall in commodity prices impacted materials companies, including Teck Cominco (TCK) (-12.63%), and Cameco (CCO) (-14.83%). Cameco's decline was further compounded by its announcement on Monday that production at its Port Hope plant would be haulted due to contaminated soil found underneath the plant. Sears Canada (SC), posted the largest percentage gain of the week (+7.86%), after second quarter results beat analyst expectations. Shaw Communications (SJR.B) gained 4.68%, after speculations of a possible takeover by Rogers Communication (RCI) resurfaced. In mergers and acquisitions news, shareholders of Abitibi Consolidated (ABY) and Bowater (BOW) approved Bowater's takeover of Abitibi. In other news, Lululemon (LLL)'s initial public offering was on Friday, and shares closed up 56%, to close $29.72. Lululemon represents the largest Canadian IPO so far this year.
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