TORONTO (Reuters) - Canada’s main stock index fell on Monday as lower commodity prices weighed on miners and energy companies and investors took a cautious approach ahead of a U.S. Federal Reserve policy decision.
U.S. crude oil prices CLc1 fell about 3 percent after Iran quashed hopes of a quick deal by major producers to freeze output and oversupply concerns resurfaced after a six-week recovery in prices. [O/R]
“It’s a story about oil, and then we’re waiting for the Fed later this week,” said John Stephenson, president at Stephenson & Company Capital Management.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended down 44.46 points, or 0.33 percent, at 13,477.54.
Seven of the index’s 10 main groups ended in negative territory, with industrial and consumer stocks rising.
Veresen Inc (VSN.TO) slumped 7 percent to C$7.93 after its application to build an LNG export terminal and natural gas pipeline was rejected.
The materials group, which includes precious and base metals miners and fertilizer companies, lost 1.3 percent.
The U.S. Fed, which ends its two-day policy meeting on Wednesday, has said it is on track to raise rates gradually in 2016, but that doing so will hinge on the health of the economy.
Recent data has shown above-forecast jobs creation but wage growth remains a concern.
“No one believes they are going to raise four times from here,” Stephenson said, referring to current guidance that he expects will likely be trimmed back.
Gold miners retreated as prices for the precious metal slipped from last week’s 13-month high ahead of the Fed meeting and another key policy decision from the Bank of Japan.
Canadian home prices rose in February, driven by a surge in the already strong Vancouver market, data showed, in the latest sign of a growing divide in the country’s real estate sectors.
Bombardier shares were flat at C$1.16 after the federal government made clear it would not announce plans to help the struggling plane maker before the March 22 budget.
Reporting by Alastair Sharp; Editing by James Dalgleish and Diane Craft