TSX falls on lower oil prices, credit market uncertainty

Wed Feb 10, 2016 5:34pm EST
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By Fergal Smith

TORONTO (Reuters) - Canada's main stock index fell on Wednesday, hitting a two-week low as a drop in oil prices and credit market uncertainty weighed on energy and financial stocks.

The market closed lower for a fourth straight day despite reassurance from Federal Reserve Chair Janet Yellen about the U.S. economy's ability to absorb a gradual rise in interest rates.

The weak oil price "continues to put pressure on the index," said Youssef Zohny, a portfolio manager at StennerZohny Investment Partners.

U.S. crude prices CLc1 fell 2 percent after stockpiles at the main U.S. delivery point hit record highs.

Canadian Natural Resources Ltd (CNQ.TO: Quote) fell 2.7 percent to C$27.36, while Cenovus Energy Inc (CVE.TO: Quote) was down 8.4 percent at C$13.52. The overall energy group fell 2.7 percent.

Financial stocks fell 1.4 percent after reversing earlier gains. It included a 2.1 percent drop in the shares of Royal Bank of Canada (RY.TO: Quote) to C$66.19.

Bank stocks are likely to remain under pressure ahead of earnings as investors worry about uncertainties surrounding energy and credit markets, according to Zohny.

Algonquin Power & Utilities Corp (AQN.TO: Quote) fell 7.8 percent to C$10.64 after announcing on Tuesday a C$3.4 billion acquisition.   Continued...

A man walks past an old Toronto Stock Exchange (TSX) sign in Toronto, June 23, 2014. REUTERS/Mark Blinch