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Roundup: Canadian stock market retreats on Chinese yuan's decline

Xinhua, August 13, 2015 Adjust font size:

Canada's main stock market in Toronto on Wednesday moved lower as Chinese currency renminbi, or the yuan, extended its decline for a second consecutive day. On the closing bell, Toronto Stock Exchange's benchmark Standard& Poor's/TSX Composite Index was modestly lower 75.14 points, or 0. 52 percent, to 14,339.53 points, as the most weighed sector Financials lost 0.88 percent.

Canada's biggest lender Royal Bank of Canada dropped 1.01 percent to 75.84 Canadian dollars (about 58.46 U.S. dollars) a share, while the insurance giant Manulife Financial Corp. plunged 2.03 percent to 22.68 Canadian dollars per share.

And in the midday trading, the index nosedived more than 200 points to hit an intra-day low at 14,182.46 points, when Financials led the decline as a decline in yuan against the U.S. dollar triggered investors' concerns about global growth.

The People's Bank of China (PBOC), the country's central bank, on Tuesday announced a decision to reform foreign exchange rate formation system.

A report released by TD Bank Tuesday heralded the move taken by PBOC as necessary to move its daily reference rate with the U.S dollar closer to market pricing, which had been trading close to its allowed limit of 2 percent. The report also predicted that a further depreciation of the RMB may be forthcoming.

And Industrials, down 1.43 percent, suffered the biggest drop by percentage point when Canadian National Railway Company declined 1.09 percent to 80.17 Canadian dollars.

Meanwhile, Air Canada, another heavyweight in the industrial sector, vapored 6.36 percent to 12.08 Canadian dollars per share, although the biggest airline in the country announced that its net profit jumped 33 percent to 296 million Canadian dollars in the second quarter this year, which is partly attributed to the falling fuel prices.

Other losers included Energy and Health Care, lower 0.52 percent and 1.36 percent, respectively.

By contrast, Utilities strengthened 1.07 percent when the gas and electricity distributor Fortis rose 1 percent to 38.55 Canadian dollars a share.

The mining sector rebounded 0.16 percent, and Telecom rallied 0. 46 percent.

On the currency front, the Canadian dollar on Wednesday was traded higher to 0.7708 U.S. dollar, when compared with 0.7631 U.S. dollar Tuesday. Endite