OPEC meeting in focus as energy shares drag TSX down
By John Tilak
TORONTO (Reuters) - Canada's main stock index fell on Wednesday as the shares of energy producers dropped with oil prices, with investors looking ahead to the outcome of an Organization of the Petroleum Exporting Countries meeting later this week.
The meeting is significant as it comes after months of volatility in the price of oil, which has plummeted over concerns about an imbalance in the commodity's supply and demand.
Investors hopeful of a big supply cut were dealt a blow as OPEC leader Saudi Arabia and fellow member the United Arab Emirates indicated they were unlikely to push for a major change in oil output at the meeting.
The energy sector, which has lost about a quarter of its value since the middle of June, remained under pressure.
“The markets are skittish. The concern is that the OPEC guys are not stepping in to curtail production and put a floor under the oil price,” said Paul Taylor, chief investment officer at BMO Asset Management.
“Now the question is whether you go in and start (chipping) away at some of these names,” he added. “I’ve got to believe that the upside-downside equation is now skewed more to the upside in terms of the commodity price.”
The Toronto Stock Exchange's S&P/TSX composite index closed down 35.24 points, or 0.23 percent, at 15,038.41. Eight of the 10 main sectors on the index were higher.
The shares of energy producers declined 2.3 percent, with Suncor Energy Inc losing 1.4 percent to C$39.07 and Canadian Natural Resources Ltd giving back 1.6 percent to C$41.38. Continued...