TSX down 1 percent, investors sell banks after earnings

Thu Dec 3, 2015 4:48pm EST
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By Alastair Sharp

TORONTO (Reuters) - Canada's main stock index fell more than 1 percent for a second straight day on Thursday, as some of its biggest banks retreated despite reporting profit growth and railway and pipeline stocks also weakened.

The broad move lower was in line with losses in U.S. and European equity markets as investors expressed disappointment over the European Central Bank's latest policy easing measures. [.N]

Gold miners were the main exception to the fall, gaining as gold bounced off near six-year lows on the back of a falling U.S. dollar. [GOL/]

"The rest of the TSX weakness can be attributed to some profit-taking in the banks as well as significant weakness south of the border," said Elvis Picardo, a strategist at Global Securities in Vancouver.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended the day down 139.15 points, or 1.03 percent, at 13,324.67.

Investors overlooked forecast-topping profits reported by Canadian banks this week, focusing instead on the lenders' ability to grow in a weak economy reeling from depressed oil prices.

Toronto-Dominion Bank (TD.TO: Quote) fell 1.4 percent to C$54.30 and Canadian Imperial Bank of Commerce (CM.TO: Quote) declined 2.2 percent to C$98.58. Overall, the financials group lost 1.2 percent.

The ECB cut its deposit rate deeper into negative territory and extended its asset buys by six months, but disappointed investors who had expected more.   Continued...

A sign displaying TSX information is seen in Toronto November 20, 2008.   REUTERS/Mark Blinch