TSX edges higher as financials gain ground

Mon May 29, 2017 5:01pm EDT
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By Fergal Smith

TORONTO (Reuters) - Canada's main stock index edged higher on Monday in light trading volume, as gains for several big banks that reported earnings last week offset losses for resource stocks.

The financials group, which had been pressured recently by investor concerns about the country's potentially overvalued real estate market and elevated levels of household debt, gained 0.2 percent.

"I think you have to go back to the fundamentals of the Canadian banks," said Sadiq Adatia, chief investment officer, Sun Life Global Investments.

"They don't really need to see a massive amount of growth ... their balance sheets are good for them to continue on with their dividend yields and even for them to increase that dividend yield"

Royal Bank of Canada (RY.TO: Quote) rose 0.6 percent to C$94.47 and Canadian Imperial Bank of Commerce (CM.TO: Quote) gained 0.8 percent to C$106.20.

Bank of Nova Scotia (BNS.TO: Quote), which is due to report its earnings on Tuesday, ended up 0.3 percent at C$76.12.

The gains were offset by losses for some gold mining stocks even as the price of the precious metal XAU= held near a one-month high.

Goldcorp Inc (G.TO: Quote) lost 1.2 percent to C$18.25, while the energy group dipped 0.1 percent even as oil prices rose. U.S. crude CLc1 prices were up 0.4 percent at $49.99 a barrel.   Continued...

FILE PHOTO - A man walks past an old Toronto Stock Exchange (TSX) sign in Toronto, Ontario, Canada on June 23, 2014.  REUTERS/Mark Blinch/File Photo